IMF revises Pakistan’s GDP growth projection to 2% for 2023

The International Monetary Fund (IMF) has downgraded its projection for Pakistan’s GDP growth rate, now anticipating it at only 2% in 2023 compared to its previous estimate of 3.5%.

Notably, Pakistan’s growth rate was 6% in 2022. However, the updated World Economic Outlook report by the global lender projects a GDP growth of 4% for 2024.

The World Bank also shares a similar outlook for Pakistan, estimating a growth rate of 2% in the fiscal year 2022-23.

Meanwhile, the global growth rate is expected to decline from 3.4% in 2022 to 2.9% in 2023 and then rise to 3.1% in 2024.

However, the IMF acknowledges that the balance of risks is tilted towards the downside, with factors such as Russia’s conflict in Ukraine, tighter global financing costs, and adverse health outcomes in China posing threats to the recovery.

To overcome these challenges, the IMF recommends targeted fiscal support for those impacted by high food and energy prices, along with stronger multilateral cooperation to preserve the gains of the rules-based multilateral system and combat climate change.