Pakistan’s trade numbers show an overall decline in the first half of the current financial year, and a recovery in its exports depends on the pace of the global economic recovery and a reduction in uncertainty, according to World Bank senior economist Gonzalo Verela.
Pakistan’s July-December aggregate trade figures show a decline in both exports and imports, with goods exports taking a big hit during the period, Varela said on the growing uncertainty of issues surrounding the country’s overall trade.
In a series of tweets, the trade and macroeconomic researcher pointed out that overall exports declined in July-December 2013 with services showing a marginal improvement. “Pakistan’s exports declined in 1H23 over 1H22 by 4%. The decline was due to exports of goods, which fell by 5.8%, Varela noted.
According to the World Bank economist, exports expanded to Italy, Spain, Germany and the Netherlands, in addition to shrinking shipments to China, the United States, the United Kingdom and the United Arab Emirates.
Varela went on to say that textile exports, in particular, are still growing, but very timidly. Exports of non-textile products, especially vegetables, minerals and basic mineral products, declined, apart from high growth in food exports, according to the breakdown of the data.
Month-on-month growth figures show a slowdown in exports of plant and mineral products, and this is where estimates show a slowdown in textiles over the period.
Varela pointed to an improvement in some of the main exports of knowledge-intensive services, mainly Telecommunications, Computer and Information Services and other businesses in particular, although at a slower pace than previously seen.
The other side of trade shows imports fell sharply by 19.6% in July-December 2013, with almost equal declines in goods and services.
Imports of machinery and textiles (probably anticipating a decline in apparel exports) and chemicals showed negative growth over the period.
The monthly breakdown of data on the most commonly imported materials sheds light on some of the slowdowns. “Zooming and checking the monthly data shows the steady decline in machinery and intermediate inputs imports,” Varela added.
A deeper analysis of the data reveals that machinery imports have contracted across different machinery types.
In his concluding remarks on Pakistan, Varela concluded in his concluding remarks on Pakistan that the pace of the global economic recovery and the reduction of uncertainty will be critical to the recovery of the country’s exports.