ISLAMABAD: The annual Economic and Social Survey of Asia and the Pacific 2019 titled ‘Ambitions beyond Growth’, released by the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) on Thursday, forecast Pakistan’s GDP to remain the lowest in the region at 4.2 per cent in 2019 and 4pc in 2020.
According to the survey the overall economic conditions in the region are stable, with a projected GDP growth of 5 and 5.1 per cent respectively.
However, decreased demand in Europe and possibly the US, as well as looming uncertainty over the ongoing US-China trade war has dealt a blow in export-oriented sectors.
The report points out the following issues in Pakistan’s economy: severe balance of payment difficulties amid large economic and current account deficits, and an increasingly weak currency.
Inflation in the developing Asia-Pacific region is forecast to increase moderately in 2019 to 4.2pc before dropping to 3.8pc in 2020.
There is also a threat of a rise in consumer and food prices, owing to potentially higher tariffs against the backdrop of trade tensions and rising uncertainties, currency depreciation, and unfavourable weather.
The survey reports that the region’s medium and long-term prospects depend on structural transformation and broad-based productivity growth.
The report cautions against countries shifting from agriculture-based economies to service-sector oriented ones, bypassing the manufacturing sector.
New frontier technologies may reduce the scope for industrialisation in “late entrant” developing countries, while high-value-added services require skilled workers.
This calls for investment in human resources and strengthening infrastructure, the survey recommends.
Insisting that the upcoming era of structural transformation in the region must be environment-friendly, the survey makes clear that investments to speed up transition to more resource-efficient systems of supply and demand would not only reduce carbon emissions by a tenth, but deliver higher profits.
The 2019 survey points out that an annual additional investment of $1.5 trillion for Asia-Pacific developing countries – equivalent to 5pc of their combined GDP in 2018 – will be required to achieve SDGs in 2030.
The survey also notes that although economic growth is rapid, it is unequal.
The report warns that environmental pollution levels are shockingly high, putting at risk the gains made in the past.
In view of these challenges, the report warns that the age-old cry of prioritising GDP growth at all costs is neither feasible nor desirable.