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flag Pakistan Pakistan: Economic and Political Outline

Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

Economic Indicators

The GDP's growth rate remained positive despite the international economic crisis, thanks to the positive results of the agricultural sector. In recent years, the  government made significant macro-economic reforms, which include the privatization of state-subsidized services, the institution of an anti-money laundering law, an increase in the harshness of punishment against the piracy of intellectual property and quick settlements for the disputes between investors. In the context of  the fight against terrorism, the country has received substantial financial aid from the United States, an important factor for growth and economic stability. However, when this payments reached their end in October 2008, Pakistan asked aid from the IMF and adopted a stabilization plan which has obtained limited results. Despite a slight improvement, the country remains confronted with several difficulties: economic slowdown, budgetary deficit and insufficient growth of tax receipts. The major threats to Pakistan's economy are: international high prices in oil barrels, inflation, raw materials prices, a deficit on the balance of payments and political insecurity and uncertainty.

Since 2011, economic activity has not been sufficient to meet the challenges facing the Pakistani society. Growth has been declining (2.6% in 2011), the deficit reached 3.4% of the GDP and inflation reached 15%. The decrease in industrial production only testifies to the lack of investment and the chronic shortage of energy supply. The unemployment rate is estimated at about 7.5% and the level of underemployment is very high. Life expectancy is only 64 years and less than 55% of the population is literate. Moreover, the increasing poverty (22.3% of the population living below the poverty line) is the direct result of these economic difficulties and of problems of governance. Extreme poverty and underdevelopment are major problems, especially in rural areas. Lastly, the country's public debt stood at around 66.4% of GDP the end of 2011, up 17% compared to the previous year.

The perspectives of growth for 2012 are expected to be low due to the strong floods that again devastated the country in 2011. Thousands of agricultural workers lost their jobs and the cost of reconstruction is estimated at billions of US dollars. The country's economic situation therefore remains fragile and uncertian.

 
Main Indicators 2009201020112012 (e)2013 (e)
GDP (billions USD) 161.82176.87204.08233.76248.02
GDP (Constant Prices, Annual % Change) 1.73.8e2.63.84.5
GDP per Capita (USD) 9621,030e1,1641,3071,359
General Government Gross Debt (in % of GDP) 57.456.857.6e57.356.5
Inflation Rate (%) 20.811.7e13.9e14.012.0
Unemployment Rate (% of the Labor Force) 6.26.26.26.26.2
Current Account (billions USD) -9.26-3.95e0.44-3.88-5.18
Current Account (in % of GDP) -5.7-2.20.2-2.1-

Source: IMF - World Economic Outlook Database ; World Bank , Last Available Data

Note: (e) Estimated Data

Main Sectors of Industry

The agricultural sector is the main pillar of the Pakistani economy. It contributes around 21.8% to the GDP and employs approximately 42% of the active population. Wheat, rice, cotton, sugarcane, fruits, vegetables and tobacco are the chief crops. Cattle livestock farming is also very important. Pakistan is the 4th largest cotton producer in the world and has abundant natural resources, mainly copper, oil and gas.

The industrial sector contributes up to 23.6% to the GDP. The major industries are textile production (the largest source of  foreign exchange revenue), oil refining, metal processing, and the production of cement and fertilizers. Maritime transport is also a significant activity.

The tertiary sector contributes to around half of the GDP.  Money transfers from Pakistanis working abroad create a considerable godsend financial income for the country.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 44.7 20.1 35.2
Value Added (in % of GDP) 21.8 23.6 54.6
Value Added (Annual % Change) 2.0 4.9 4.6

Source: World Bank - Last Available Data.

 

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Monetary Indicators 20062007200820092010
Pakistani Rupee (PKR) - Average Annual Exchange Rate For 1 USD 60.2760.7470.4181.7185.19

Source: World Bank - Last Available Data.

 

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Learn more about Market Analyses about Pakistan on Globaltrade.net, the Directory for International Trade Service Providers.
 

Indicator of Economic Freedom

Score:
55.1/100
Position:
Mostly unfree
World Rank:
118/179
Regional Rank:
23/38

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation

Note: The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

 

Country Risk

See the Country Risk Analysis Provided By Ducroire.

 

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Foreign Trade in Figures

Despite its economic and political difficulties, Pakistan has taken steps to liberalize its trade and investments in the context of commitments made with the WTO, IMF, and the World Bank. The share of foreign trade in the country’s GDP is around 35%. The drop in global demand during 2008-9 resulted in a high trade deficit.

Pakistan's three main customers are the United States (more than 27%), the United Arab Emirates (7%) and Afghanistan (6.5%). The main export commodities are cotton, textiles, clothing and cereals.

Its three main import partners are Saudi Arabia (more than 11% of imports), the United Arab Emirates (11%) and China (11%). Pakistan mainly imports fuels, oil, vehicles, iron and steel.

60 years after the establishment of diplomatic relations between the two countries, Pakistan and China continue to share the same strategic issue: how to counterbalance the Indian hegemony in Southern Asia. In addition to military cooperation, trade and investment also play a role and China's place as Pakistan's trading partner is becoming gradually more important.

Turkey, Saudi Arabia, Iran and the Golf countries are also among the country's largest trading partners.

 
Foreign Trade Indicators 20072008200920102011
Imports of Goods (million USD) 32,59042,32931,66837,81044,040
Exports of Goods (million USD) 17,83820,32317,52321,51525,790
Imports of Services (million USD) 8,4269,2865,9026,4817,231
Exports of Services (million USD) 2,2242,5312,5482,9493,394
Imports of Goods and Services (Annual % Change) -3.53.5-15.211.2-
Exports of Goods and Services (Annual % Change) 2.3-5.3-3.314.1-
Imports of Goods and Services (in % of GDP) 21.323.920.419.0-
Exports of Goods and Services (in % of GDP) 14.212.912.812.9-
Trade Balance (million USD) 10,587-17,00310,27011,416-
Trade Balance (Including Service) (million USD) 15,631-22,132---
Foreign Trade (in % of GDP) 35.536.733.231.9-

Source: WTO - World Trade Organization ; World Bank , Last Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2010
United States 17.2%
United Arab Emirates 8.6%
Afghanistan 7.9%
China 6.7%
United Kingdom 5.2%
See More Countries 54.5%
Main Suppliers
(% of Imports)
2010
United Arab Emirates 14.0%
China 14.0%
Saudi Arabia 10.2%
Kuwait 6.9%
Malaysia 5.5%
See More Countries 49.4%

Source: Comtrade, Last Available Data

 

Main Products

Main Exports
(% of Exports)
2010
Bed-linen, table linen, toilet linen and kitchen...Bed-linen, table linen, toilet linen and kitchen linen of all types of textile materials (excl. floor-cloths, polishing-cloths, dish-cloths and dusters) 12.3%
RiceRice 10.6%
Cotton yarn other than sewing thread, containing >...Cotton yarn other than sewing thread, containing >= 85% cotton by weight (excl. that put up for retail sale) 7.6%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 5.6%
Men's or boys' suits, ensembles, jackets, blazers,...Men's or boys' suits, ensembles, jackets, blazers, trousers, bib and brace overalls, breeches and shorts (excl. knitted or crocheted, wind-jackets and similar articles, separate waistcoats, track suits, ski suits and swimwear) 4.0%
See More Products 59.9%
Main Imports
(% of Imports)
2010
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 19.3%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude 9.4%
Palm oil and its fractions, whether or not refined...Palm oil and its fractions, whether or not refined (excl. chemically modified) 4.4%
Cane or beet sugar and chemically pure sucrose, in...Cane or beet sugar and chemically pure sucrose, in solid form 2.2%
Cotton, neither carded nor combedCotton, neither carded nor combed 2.0%
See More Products 62.7%

Source: Comtrade, Last Available Data

 
 

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Sources of General Economic Information

Ministries
Government ministries and departments
Ministry of Commerce
Ministry of Finance
Ministry of Economic Affairs & Statistics
Statistical Office
Statistics office
Central Bank
State Bank of Pakistan
Stock Exchange
Islamabad Stock Exchange
Karachi Stock Exchange
Lahore Stock Exchange 
Search Engines
Google Pakistan
Yahoo Pakistan
Paki Search
Pakistan Services
Pakistan Webs Directory
Pak Avenue
Pak.org
OPD - Pakistan
Economic Portals

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Political Outline

Executive Power
President is the chief of state and is elected by the parliament for a five-year term. President is the commander-in-chief of the armed forces. Though President is supposed to have a largely ceremonial role but military Presidents have played an influential role in country's mainstream politics throughout Pakistan's history. Prime Minister is elected by the lower house of the parliament through a vote for a five-year term. Prime Minister is the head of the government and enjoys the executive powers which include implementation of the law and running the day-to-day affairs of the country. The council of ministers (cabinet) is appointed by the President on the advice of the Prime Minister.
Legislative Power
The legislature in Pakistan is bicameral. The parliament consists of: Senate (the upper house) having 100 seats, with its members indirectly elected by provincial assemblies to serve six-year terms; and National Assembly (the lower house) having 342 seats, with its members elected by popular vote to serve five-year terms. President can be impeached and removed from its office by two-third majority vote of the National Assembly, but the constitution of the country also gives the President the unique power to dissolve the National Assembly and also to dismiss the Prime Minister. Prime Minister cannot dissolve the parliament . The people of Pakistan still have limited political rights.
Main Political Parties
Pakistan has a multi-party system in which no one party often has a chance of gaining power alone, and parties work with each other to form coalition governments. Some of the major political parties in the country are:
- PML(Q) (Pakistan Muslim League-Quaid-e-Azam) - centrist conservative political party derived from the original Pakistan Muslim League which had laid foundation of the state of Pakistan;
- PPPP(Pakistan People's Party Parliamentarian) – a mainstream political party derived out of Pakistan Peoples Party, MMA (Muttahhida Majlis-e-Amal Pakistan) - a coalition of Islamic religious parties;
- PLM-N (Pakistan Muslim League - Nawaz group) – also derived from the original Pakistan Muslim League;
- MQM (Muhajir Qaumi Movement) - originally an ethnic student’s organization but now more known for its terrorist activites.

Note: Name and alliances of political parties in Pakistan keep on changing frequently.

Current Political Leaders
President: Asif Ali ZARDARI (since September 2008)
Prime Minister: Syed Yousuf Raza GILANI (since March 2008)
Next Election Dates
Presidential: Year 2013
National Assembly: 2013
 

Indicator of Freedom of the Press

World Rank:
151/179
Evolution:
same place compared to 2010

Source: Worldwide Press Freedom Index 2011, Reporters Without Borders

Note: The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position is assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

 

Indicator of Political Freedom

Ranking:
Partly Free
Political Freedom:
4/7
Civil Liberties:
5/7

Map of freedom 2010
Source: Freedom House

Note: The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

 

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