Monday Apr 17, 2017
ISLAMABAD: With growth prospects continuing to improve and inflation remaining contained, Pakistan economy would continue to grow at 5.2 percent in 2017, the World Bank (WB) predicted in its recent report.
"In Pakistan, economic activity expanded by 4.7 percent in 2016 and is expected to continue to grow at 5.2 percent in 2017," said WB’s twice-a-year South Asia Economic Focus report.
According to the report, the China-Pakistan Economic Corridor (CPEC) projects have supported construction activity, which is expected to stimulate industrial sector growth.
These projects should help accelerate growth in the domestic construction industry and increase electricity generation, the report said, adding that sustainable and inclusive growth and poverty reduction will require greater private sector investment and longer-term development of infrastructure.
Providing a big picture of South Asia, the report also confirmed that the region remains the fastest-growing in the world, gradually widening its lead relative to East Asia.
Regional GDP growth is expected to rise from 6.7 percent in 2016 to 6.8 percent in 2017, and 7.1 percent in 2018, it added.
According to the report, possible protectionism in advanced economies should not deter export-oriented growth in South Asia – a region that could even benefit from the backlash against globalisation.
The just-released edition of the South Asia Economic Focus report also explores whether South Asian countries should worry about mounting protectionist pressures.
"Simulations on the impact of hypothetical new trade barriers show that South Asia is not only resilient to a potential rise in protectionism but could possibly even gain from it in some circumstances," said Annette Dixon, the World Bank South Asia Region Vice President.
Dixon said that advanced economies were recovering and could see faster growth that will likely increase demand for South Asian products, adding the region should seize this opportunity to diversify its exports and enhance its supply response.
This could create a substantial number of jobs for new entrants to the labor force, Dixon added.