One under-reported item that slid by everyone. It’s a piece of news that all of us have been waiting for on the economic front for the last few months.
As per the latest numbers released by FBS, Pakistani exports were stable on a month to month basis (November and October) as well as stable on a year on year basis (November 2008, November 2007). This means that we had more or less zero growth in our export numbers. That is the not the good news, the good news is that import fell by about 21% on a month on month basis and by about 26% on a year on year basis. Part of this is the slow down, part of this is lower oil prices, and a large part is the exchange rate shock.
But the net impact on balance of trade is a reduction of about 38% and the gap is now down to a much more manageable 1.12 billion dollars a month from a high of an unsustainable 2 billion dollars a few months ago. We are not out of the woods yet. Of the 13 billion US$ hole, we have between 7 – 8 in worker remittances, another two, possibly three in foreign direct investments and the rest is already in the bank courtesy the IMF. But this assumes that exports will maintain their stability and import will carry on their declining trend. Let’s see what the numbers in January say.