State Bank of Pakistan releases report on the impact on the economy. Because of the Coronavirus pandemic, trade has affected. And the global economy has observed decline in remittances and investments.
The report said lower oil prices benefited importing countries, while Corona affected local business activities, reduced purchasing power and reduced foreign investment.
According to the report, the economic slowdown has also led to a drop in revenue, a lockdown to control the epidemic, which has affected the cash flow of factories and the business community, and if the situation continues, many companies could go bankrupt.
The SBP report said that the bankruptcy of companies would affect the income of banks and the closure of businesses would also increase unemployment, while in the current situation, foreign exchange reserves may decrease.
According to the report, while expressing concern over the devaluation of the rupee, the SBP said that if the situation remained the same, there was a risk of devaluation of the rupees. The economic growth rate and budget would be affected.
According to the report, rating agencies kept Pakistan’s rating stable as revenues began to rise in early 2020, business confidence increased and foreign investment began to rise sharply.
The central bank report on health said that government spending on the health sector is lower than in other countries in the region. In the current situation, public awareness is very important. Lockdown will be a challenge to provide food and social security.
According to the SBP, Pakistan’s debt is increasing, Pakistan’s economy is based on consumption and declining purchasing power of the people will affect GDP.
Extracted from City42 News
