Islamabad:
The International Monetary Fund (IMF) reduced only 2.6% for the current fiscal year, while reviewing the global economic projections in the midst of the uncertainty derived from the commercial rate measures of the president of the United States.
In its World Economic Perspectives Report of April 2025, the IMF reduced Pakistan growth estimation from 3% to 2.6%, becoming the second important international financial institution in reducing the country’s growth perspective for fiscal year 2024-25.
The reviewed forecast does not reach the growth objective of 3.6% established by the Pakistani government for the fiscal year. For next fiscal year, the IMF sees that Pakistan’s economic growth reaches 3.6%.
However, Pakistan’s inflation perspective has improved from almost 10% to 5.1%, which is also expected to remain at 7.7% in the next fiscal year. In another positive development, the IMF improved the projection of Pakistan current account of almost 1% of GDP at only 0.1%.
Previously, the IMF expected Pakistan’s current account deficit to be extended to $ 3.7 billion, which is now projected to fall to around $ 400 million for this fiscal year. For next fiscal year, the current account deficit is projected in just 0.4% of the size of the economy.
The IMF will publish the detailed background of its projections reviewed in the country’s personnel level report, which will be published after the approval of the second section of loan by the IMF Board next month.
Finance Minister Muhammad Aurengzeb, met Monday with the IMF managing director, Kristalina Georgieva in Washington.
A brochure from the Ministry of Finance declared that Aurengzeb thanked the IMF team for reaching an agreement at the personnel on the first review under the installation of extended funds (EFF) and a new agreement under the center of resilience and sustainability (RSF).
Aurengzeb reiterated the commitment of the Pakistan government to maintain the impulse of reform and extended an invitation from Prime Minister Shehbaz Sharif to Georgieva to visit the country, the Ministry of Finance said.
The Minister of Finance also held a meeting with Robert Kaproth, Undersecretary of the United States Department of the Treasury, and informed him about the macroeconomic indicators of Pakistan improvement. He highlighted reforms on taxes, energy, privatization, state companies (SOES), pensions and debt management.
In an interview with Bloomberg in Washington, the Minister of Finance, Aurangzeb, said Tuesday that Pakistan was looking to buy more products from the United States and eliminate non -directive barriers to escape the high rates of President Donald Trump.
Global perspective
The IMF has given a range of 2.4% to 2.8% for global economic growth by 2025 due to the uncertainty caused by the commercial policy measures of President Trump.
The rapid escalation of commercial tensions has generated extremely high levels of political ambiguity, which makes it more difficult than usual to establish a central global growth perspective, read the IMF report.
He said that for this reason, the global economic perspective presents a variety of global growth projections. The reference forecast is based on the measures announced on April 4, which the IMF said would reduce global growth to 2.4%.
Forecasts based on models after April 9 are used to quantify the implications of the announced pause and additional associated exemptions, as well as intense tariff rates between China and the United States, economic growth is projected to 2.8%.
