Pakistan's current account deficit drops to $464mn: SBP

KARACHI: Pakistan’s current account deficit has seen a substantial reduction over the past 11 months, dropping by $3.3 billion to a mere $464 million, according to the State Bank of Pakistan (SBP), which is still massively lower than $3.76 billion in the same period of the previous year.

This improvement attributed to a notable decrease in the trade deficit, which fell by 87 percent during the same period.

In May 2024, the current account deficit stood at $27 million. The month’s trade figures revealed imports worth $5.93 billion against exports of $3.69 billion, resulting in a trade deficit of $2.3 billion. The combined deficit from trade, services, and revenue for 2024 reached $3.66 billion.

Worker remittances in May amounted to $3.24 million, contributing positively to the current account balance, while the current account balance for the 11 months remained slightly negative at $46.40 million.

From July 2023 to May 2024, Pakistan’s imports totaled $48.40 billion, while exports were significantly lower at $28.67 billion, leading to a trade deficit of $19.72 billion.

The overall loss from trade, services, and income for the 11 months was recorded at $29.37 billion. Worker remittances over this period were reported at $27.9 million.

Pakistan is currently engaged in talks with the International Monetary Fund (IMF) over a new longer and longer bailout with the lender as it looks to shore up its central bank’s foreign exchange reserves, which currently stand at $9.13 billion.