By Staff Reporter
KARACHI: Pakistan posted a current account surplus of $397 million in December, reversing six months of deficits, as exports rose and imports fell, the central bank said on Wednesday.
The surplus, which compares with deficits of $15 million in November and $365 million in December 2022, was the first since June 2023, when the country recorded a surplus of $28 million.
The State Bank of Pakistan (SBP) said in a statement that total exports increased by 5.1 percent month-on-month and 14.15 percent year-on-year to $3.53 billion in December, while total imports declined by 6.13 percent month-on-month and 0.14 percent year-on-year to $4.97 billion, as the government imposed some restrictions on non-essential imports to curb the trade deficit.
The improvement in the trade balance was partly offset by a higher deficit in the services and income accounts, the SBP said.
Remittances from overseas Pakistanis also rose by 13.3 percent to $2.38 billion in December, as workers sent more money home through legal channels after a government crackdown on the gray market.
However, remittances declined by 6.82 percent year-on-year to $13.44 billion in the first half of the fiscal year, mainly due to the base effect of a record-high level of $14.42 billion in the same period of the last fiscal year.
For the July-December period, Pakistan posted a current account deficit of $831 million, down by 77.1 percent from $3.63 billion in the same period of the previous fiscal year, the SBP said.
The central bank, which kept its policy rate unchanged at 22 percent in its last meeting in December, said the current account deficit was “manageable” in the current fiscal year.
The current account is a key indicator of a country’s external balance and measures the flow of goods, services, and investments. Pakistan, which relies heavily on imports to meet its energy and industrial needs, has faced persistent current account deficits in the past, putting pressure on its foreign exchange reserves and currency.
Copyright © 2021 Independent Pakistan | All rights reserved
