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Services sector export deficit up by 12pc

KARACHI: The trade deficit in services increased 12.3 per cent in the first five months of the current fiscal year, the Pakistan Bureau of Statistics has reported.

The gap widened because of an upward trend in the import of services. It edged up to $2.1 billion in during the period under review. In November, the deficit went up 36.5pc year-on-year to $459 million.

Data shows exports of services posted a negative growth of 0.42pc year-on-year to $406.9m in November.

In July-November, services’ export proceeds rose 3.4pc to $2.07bn from $2bn a year ago.

Last year, exports of services increased 1.76pc to $5.55bn.

The import of services went up 7.7pc to $4.2bn in July-November against $3.87bn in the corresponding period of the last year.

In November, the import of services edged up 16.3pc year-on-year to $865.9m. Services’ imports in 2016-17 increased 2.96pc to $9.12bn.

Exports grew nearly 15 per cent year-on-year in December 2017, raising hopes about a revival in the overseas sales of Pakistani goods.

The upward trend in exports will contribute towards bridging the deficit in current account, which is under pressure because of rising oil prices and growing imports of other fuels and machinery.

In absolute terms, exports edged up to $1.97 billion in December from $1.72bn a year ago, data released by the Pakistan Bureau of Statistics showed on Wednesday.

In the first half of the current fiscal year, export proceeds recorded an annual growth of 11.24pc to $11bn.

Talking to Dawn, Commerce Secretary Younus Dagha said exports have been increasing since last June. They increased 12.3pc and 14.8pc in November and December, respectively.

Rise in imports slowed down to 10pc in December He said the premier’s export package, realistic exchange rate and growing international demand will help maintain the growth momentum.

Imports recorded an increase of 19.1pc to $28.97bn in July-December. They grew 10.1pc year-on-year to $4.91bn in December.

Mr Dagha said the upward trend in imports, as witnessed throughout 2017, also slowed down in December. The increase in imports, which was 37pc in January and July, came down to 10pc in December.

This is despite the fact that crude oil prices went up from $47 per barrel in July to $67 per barrel in December, showing an increase of 43pc, he said.

Excluding fuel imports, which registered an increase of almost 30pc, the rest of imports have shown only 1pc rise, the secretary said.

He said imports of non-oil and non-essential consumer goods are expected to remain under control due to import rationalisation initiatives. However, rising oil prices and higher machinery imports remain a challenge for the balance of trade, he added.

Imports of mobile phones and apparatuses also witnessed tremendous growth during the period under review.

The merchandise trade deficit swelled nearly 25pc to $17.96bn in the first six months of this fiscal year. It rose 7.12pc year-on-year in December to $2.94bn.

The last fiscal year saw the trade deficit rise to an all-time high of $32.58bn, representing year-on-year growth of 37pc. The country’s annual trade deficit was $20.44bn in 2013. It has been continuously on the rise since then.

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