KARACHI: Pakistan recorded a current account deficit of $662 million in December, after remaining in surplus for the last five months mostly due to higher imports.
According to the latest data by the State Bank of Pakistan (SBP), the country posted a current account surplus of $513 million in November, while it registered a small deficit of $287 million in December 2019.
During the six months of the current fiscal year, the current account remained in surplus, and stood at $1.131 billion, compared with a deficit of $2.032 billion in the same period of last fiscal year.
“Exports and remittances continued to grow steadily in December 2020 compared to last year. Imports of some essential food items as well as growth-enhancing capital goods, oil and industrial raw materials also rose on the back of the domestic economic recovery,” the central bank said in a tweet.
The imports rose 32 percent year-on-year to $5.019 billion in December, while exports increased 6.78 percent to $2.251 billion.
The economic activity is gaining momentum, which is evident from the fact that the large-scale manufacturing (LSM) index grew 14.45 percent in November, while cumulatively, the index picked up 7.4 percent year-on-year in the five months of the current fiscal year.
The LSM index is expected to remain upbeat owing to accelerating manufacturing operations, improvement in aggregate demand and new investments.
Recent figures on the Temporary Economic Refinance Facility (TERF) also showed the investment and the economic activities recovered from the coronavirus-induced slump.
According to the SBP data, it was the first time in the past decade that the country recorded a current account surplus for two consecutive quarters. It said controlling the runaway current account deficit has been one of the key achievements of the government on the economic front.
