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December 2, 2020

Exports again surpass $2bln mark in Nov

Business

December 2, 2020

ISLAMABAD: Exports have surpassed the $2 billion mark for the second consecutive month in November, commerce adviser said on Tuesday, as the government refrained from abrupt shutdown after resurgence in coronavirus infection.

Adviser to the Prime Minister on Commerce Razak Dawood said exports increased 7.2 percent year-on-year in November “in these difficult times with resurgence of COVID-19 cases in Pakistan and globally.”

“We have once again crossed the $2 billion mark per month,” Dawood wrote in a Twitter message.

Exports showed first recovery in July after consecutive downtrends since March amid coronavirus lockdown. Ease in lockdown paved way for clearance of orders stuck on ports and revived economic activity.

However, growth could not be sustained in August with exports recorded a double-digit decline. In August, exports fell to $1.58 billion from $1.86 billion in the corresponding month a year earlier.

Global lockdowns related to coronavirus pandemic upended the world’s economy. Economic activities came to halt and ports were chocked with cargoes unmoved due to slowdown in transportation.

Resurgence in coronavirus patients highlighted needs of lockdown. But, the government imposed social-distancing orders to control the contagion spread.

Pakistan’s economy that was already tottering before the coronavirus was further mauled by monthslong lockdown. The growth is expected to recover at 1 to 1.5 percent this fiscal year after contraction in the previous fiscal year.

Exports continued to show contraction since the government took charge.

Trade deficit narrowed 27.1 percent to $23.1 billion in the last fiscal year of 2019/20, but the reduction was mainly caused by suppressing imports rather than export sector’s recovery. Exports declined 6.8 percent to $21.3 billion, whereas imports sharply fell 18.6 percent to $44.5 billion during the last fiscal year.

The incumbent government resorted to curtail imports and mobilise foreign funds to improve balance of payments position since it took over in August 2018. The International Monetary Fund’s loan program opened up inflows from other multilateral and bilateral foreign institutions to currently elevate the foreign exchange reserves to near $19 billion from $14.4 billion till end of the last fiscal year. However, exports to GDP ratio is teetering below 10 percent.

The government was asked to improve marketing efforts in the international markets, create competitive packaging and build value-chain in destination countries. This was one of the basic factors behind India’s export success, said a businessman.