NEW YORK: The World Bank in its latest report on Pakistan’s economy has said that the confidence of global investors has been restored in the country’s economy which is expected to grow by 2.7 percent in the current fiscal year (2024–25).
The World Bank in its report said Pakistan’s economy continues to stabilise and is expected to grow by 2.7 percent in the current fiscal year (2024-25). According to the report, the interest rate has also been reduced because of a decline in inflation.
“The confidence of global investors in Pakistan’s economy has been restored, with a projected economic growth rate of 2.7 percent for the current fiscal year, up from 2.5 percent in the previous fiscal year,” the WB’s report read.
Pakistan’s economy is projected to grow by 3.1% in the upcoming fiscal year and 3.4% by 2027, said the World Bank report.
However, the report cautions that the country cannot afford to delay critical structural reforms.
Among the major challenges highlighted are Pakistan’s mounting debt, volatile global trade dynamics, and the increasing impacts of climate change.
The World Bank emphasised that the escalating debt burden remains the most pressing issue, while external trade uncertainties and environmental risks also threaten economic stability.
Najy Benhassine, World Bank Country Director for Pakistan, noted that the key challenge for the country lies in converting recent stabilization progress into sustained and inclusive economic growth that effectively reduces poverty.
“High-impact reforms to prioritise an efficient and progressive tax system, support a market-determined exchange rate, reduce import tariffs to boost exports, improve the business environment, and streamline the public sector would signal strong reform commitment, build confidence, and attract investment,” he added.
Anna Twum, lead author of the report, said, “Pakistan’s economy has turned the corner and stabilised.
Yet, the economic outlook remains fragile, and any implementation delays in structural reforms or shifts in economic stabilisation could dampen the nascent recovery and intensify external pressures.”
“Risks remain high due to elevated debt levels, policy and global trade uncertainties, and exposure to climatic shocks,” the report’s author added.
Pakistan’s Minister for Finance and Revenue Muhammad Aurangzeb yesterday met with Ajay Banga, President World Bank, in Washington and expressed gratitude to the World Bank for its historical support to Pakistan and commended its leadership in developing a transformative CPF—a decade-long strategic roadmap centred around measurable impacts and outcomes.
He appreciated the World Bank’s ongoing assistance in crafting a comprehensive implementation strategy and action plan to operationalise the CPF while simultaneously enhancing overall efficiency.
The minister also provided a detailed overview of Pakistan’s macroeconomic turnaround and reaffirmed the government’s unwavering commitment to ensuring sustainable economic stability.
