Pakistan experiences other crashes in economy even this year. Although it is arguably than the previous year, recovering the economy is not an easy task.
In addition, Islamabad’s economy has been crashing for approximately 13 times for the last 60 years. Even worse, most of which require International Monetary Fund’s (IMF) bailout.
Living under a huge amount of debt is never easy for the country. Furthermore, the number of loans is so massive. Thus, the IMF even warns Pakistan to not borrow another loan considering the situation.
Regarding the warning, Pakistan tries to convince IMF and other foreign investors that the country is serious in paying off all the debts. Among them, the country cuts development expenditures increase petroleum prices, electricity tariffs, and the sales tax on sugar, as well as decreases the salaries of government ministers.
Pertaining to the investment, 2019 brought good news. The investment rate to the country elevates by roughly 200% in this year’s first half, thanks to massive investment packages from China, Saudi Arabia, and the United Arab Emirates.
However, revolutionizing the country’s economy is not an easy task. Accordingly, the government is currently trying to combat issues and attempts several strategies to recover the economy.
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Pakistan Economy: Factors Declining It and the Recovery Strategies
Besides poverty, Pakistan also suffered from a long-lasting problematic bureaucracy. However, the novel PM to step its foot, Imran Khan, gives the country new hope.
One of the many problems that cause and is the result of poverty is the high unemployment rates. To fight against it, the government has implemented various strategies and the most recent one is the export of skillful labors to Japan.
Also, the country plans to continue the second phase of the China–Pakistan Economic Corridor (CPEC). However, what adds up to the challenge is that the massive and crucial projects face delays and interruption every now and then due to debts and other financial reasons.
Despite everything, one of the most notorious problems the government needs to eradicate immediately is about terrorism and extremism. The problems, which mainly revolve around certain religious communities, have hindered the country’s progression.
For instance, terrorism disturbs the advancement of the tourism industry in the country, in which the government is trying to promote. For that reason, the government is tightening security.
Pertaining to security and terrorism, it will become the beginning milestone Pakistan has to face in 2020. The Financial Action Task Force (FATF), a global watchdog that monitors terrorist financing, will determine whether Pakistan has conducted enough efforts against terrorist groups and their financing networks. If they fail, it will potentially drive away future investors and possible bank loans in the near future.
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