Islamabad, August 29, 2022 (PPI-OT):The Pakistan Economy Watch (PEW) on Monday said a recession in the US and EU will provide relief to the developing countries reeling under high oil and commodity prices. The interest rates are being continuously increased in the US to reduce inflation, which is affecting economic activity, and will cause a recession, it said.

Recession in the US will shrink the global growth rate which will affect the exports of almost all the countries of the world, including Pakistan, while the remittances will also decrease, said Dr. Murtaza Mughal, President PEW. On the other hand, the decreased demand will start the process of reduction in the price of almost everything including oil and agricultural commodities, he said.

Dr. Murtaza Mughal said that global economic contraction will be bad news for oil-exporting countries but good news for oil-importing countries like Pakistan. He said that almost 33 percent of Pakistan’s imports comprise energy. A 50 percent reduction in the price of oil can reduce the import bill by up to ten billion dollars, which will be an enormous relief.

This will reduce the price of oil and electricity in the country, which will affect the price of almost everything, he added. He said that the global slowdown will reduce Pakistan’s exports by 20%, but if the oil import bill is reduced by 50%, then it will be good for Pakistan. Pakistan’s exports have always been low as compared to imports, but the countries with good exports record like Bangladesh, Vietnam and China etc. will suffer more.

For more information, contact:
President,
Pakistan Economy Watch (PEW)
402, 4th Floor, Gulistan Khan House, Fazal-e-Haq Road,
82-East, Blue Area, Islamabad
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