Islamabad: A recent article by The Express Tribune titled “$7 billion IMF bailout falters as economy strains,” published on October 31, 2024, has been met with a rebuttal asserting inaccuracies in the report’s economic assessments. The article’s claims regarding discrepancies in forecasts for inflation, Large-Scale Manufacturing (LSM), and imports are based on incomplete data, leading to public misperception of the economic situation.
According to Press Information Department, the article overlooks essential economic trends and relies on speculative interpretations. Current data indicate that inflation, LSM, and imports are consistent with the government’s projections, negating the need for mid-year budget adjustments. Additionally, the International Monetary Fund (IMF) has revised its economic forecasts, aligning them more closely with those of the Ministry of Finance. Contrary to the article’s assertions, the economic indicators suggest that the fiscal policy is effective and on a path to fiscal sustainability.
The actual Consumer Price Index (CPI) inflation for the first quarter was 9.2%, slightly deviating from the forecast of 10.2%. Meanwhile, the IMF has adjusted its CPI inflation forecast for FY2025 from 12.7% to 9.5%. Similarly, LSM growth projections are on track, with July’s growth exceeding expectations. The article’s claim of a 1.3% growth rate in LSM for Q1 is based on incomplete data, as official statistics are available only for July and August.
Regarding imports, the first quarter’s figures were $14,219 million, surpassing the forecasted $14,062 million and reflecting positive implications for import-related tax collection. The IMF has revised its import forecast downward, aligning it with the government’s projection. The article’s stated import growth rate for Jul-Sep FY2025 is understated, as actual imports grew by 15.7%, which is crucial for supporting the manufacturing sector’s revival.
The rebuttal emphasizes the need to consider monthly trends and seasonality when interpreting economic indicators, which the article reportedly ignores.
Source: Press Information Department