After nearly defaulting on its debt last year, Pakistan’s economy is on the mend. GDP grew by an estimated 2.4% in the year to June, following a contraction in the previous year. The annual inflation rate, which peaked at 38% in May 2023, is easing. Last month it fell to 9.6%, the lowest level in nearly three years. The International Monetary Fund aided the recovery with a bail-out of $3bn in June 2023. It has since praised Pakistan’s government for “consistent policymaking”. But Pakistani officials are hoping for more. On Wednesday the multilateral lender’s board meets to approve a new loan programme worth $7bn. It would be the 24th bail-out Pakistan has received since 1958. As part of the deal Pakistan will have to raise tax revenues by 3% of GDP
over the next three years. Many Pakistanis believe the conditions are onerous. But ruling technocrats are unlikely to be moved by protests, which they have faced down before.
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