The worsening cycle

In its latest forecasts, the International Monetary Fund (IMF) says Germany and Italy will be in recession next year, and GDP growth in the US will be just one per cent, down from an estimated 1.6pc this year. Bad news for Pakistan exports. The Fund also says that economic growth in China will inch up to 4.4pc in 2023, up from an estimated 3.2pc in 2022. Growth in Britain will be a negligible 0.3pc, down from 3.6pc. More bad news for exports. About 47pc of our merchandise export earnings originate from these five countries. Low GDP growth in 2022 and a recession/slowdown in 2023 will surely hit our exports. Pakistan’s exports in July-September 2022 totalled $7.125 billion, up only marginally from $6.996bn in July-September 2021. Demand for exports will be hit during this fiscal year ending in June 2023 because of the paled/bleak growth forecasts in the above-named large economies. Exports demand will also be hit because the IMF believes that overall global GDP growth in 2023 will be 2.7pc down from an estimated 3.2pc in 2022.