Pakistan may need to dampen economic growth hopes - IMF

04/08/2021 | 10:43am

ISLAMABAD (Reuters) - Pakistan may have to temper economic growth expectations following a third wave of COVID-19 infections, an IMF official said on Thursday.

The IMF had forecast 1.5% growth in gross domestic product (GDP) for the current fiscal year 2020-21 but then felt it could be higher after good data in January and February, IMF Mission Chief for Pakistan Ernesto Ramirez Rigo told reporters.

"Now with this third wave, perhaps we might be in a situation where we need to dampen a bit our expectations relative to the upside to the forecast," he said, adding that Pakistan would also need to adjust its annual budget.

Pakistan has recorded more than 700,000 COVID-19 infections and 15,000 related deaths since the start of the pandemic.

It has seen a sharp rise in daily infections in the last 10 days, and officials said this week there were now more people in intensive care than at any other point during the pandemic.

The IMF's economic growth forecast is half of the 3% growth projected by Pakistan's central bank.

Rigo said the IMF was in constant touch with Pakistani authorities about economic targets and fiscal revisions amid the continuing uncertainty caused by the pandemic.

The IMF approved a $500 million disbursement to Pakistan last month for budget support after competing delayed reviews of the country's $6 billion Extended Fund Facility programme.

(Reporting by Gibran Peshimam; Editing by Gareth Jones)

By Gibran Naiyyar Peshimam

© Reuters 2021
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