I have written a number of articles on economic analysis but
this time while writing, I have multiple fears as the whole world has become
under the heavy grip of COVD-19 and sufferings are so harsh that economic indicators
are also falling apart.
Being a strong believer in my Almighty Allah who is the
mighty controller of all the resources and well-being of the world.
Hypothetically believing that it is perhaps natural justice for equal
distribution of world wealth already amassed the contractor of so-called world
powers or it is still an attack on the third world to further suppress the
worsening economy. Ultimately it is suffering the poor section of the world more
than rich. If it is a manmade virus then certainly it is motivated and
well-planned action to further control the international resources and push the
weaker economy even to make it weaker and if it is natural then it is certainly
a curse and the world has to revisit the world economy to at least let the
world survive to start the new life once again. The position of our economy has
already gone worst and it is the beginning of invisible invader which has not
yet been defeated. Our present economic indicators are that the inflation rate
is 13% which is too high and it will continue to allow to increase the price
hike. Our growth is below 2.2 though govt is claiming 3.3 by the end of 2020
which is nothing by Sheikh Chaplain Claims and our govt has to get out of the
imaginary world. Sheikh Chaplain euphoric claims and such claims by previous
govts including this govt should get out of the fudged era estimate.
Our country is under heavy load of internal debt Rs32
trillion and it has to go even higher and the local bank should be happier as
they earn more strength and rather local banks should transfer the foreign cash
to Pakistan as Pakistan is paying more than 8 percent rate as compared to 2
percent international rate. I have information and others must be feeling this
unfair assault on our economy. A new Mafia has emerged with the name of
“Currency Mafia” who is too powerful and too close to the decision-makers. You
will note the local borrowing will increase by manifold and it will let happen.
It is the test of prime minister as to how smartly he catches them or he will
be forced to allow the mafia in the same way. Now the external debt $107
billion and IMF had already demanded its loan back and IMF will continue to
increase its pressure and keep Pakistan forcing for more price-hike at the cost
of the already crushed common man by the govt and IMF. The recent trench $6
billion has not been released and even if they do, it is retained under the
garb of debt servicing. Our Pakistan’s economy is already drowning in debts,
instability, inflation and irreparable financial damages that are continuing to
acute and our team was trying to handle without fixing it. Being a student of
invention and behaviour of economic indicators are indicating the further slide
of the economy and slipping of rupee therefore now I see further worsening of
economy and our financial scientists have yet to give their negative
trajectories and let see how they are going to control with our worst
indicators. During and post coronavirus economic syndrome will bring a further
major shock to our economy.
The economic indicators showed that our growth rate for
2019-20 was expected to be significantly lower from 3.3 in 2018 to 2.5 in 2020
and we are not able to achieve it. Therefore, there is the risk of a further
massive decline in Pakistan’s domestic economic activity, especially in the
agricultural industry which makes the more dominant contribution to our GDP
growth. We are already facing a decline in our exports because of the
conditions in developed country markets and exports are dropped. The stock
market is also consistently under pressure and it is falling because of general
economic distress. There has been a significant decline in foreign exchange
reserves and more than 7 percent depreciation in the value of the rupee. It has
affected our mid businesses growth rate and small business will either be shut
or go for bankruptcy.
Consumption will reduce and more money will be drawn out of
the companies account, some will be able to survive but the smallest companies
will feel be eliminated. Our biggest question if we will survive from national
bankruptcy due to this continued sliding economy and will we be able to do debt
serving within our resources or not. We hope to survive from international
bankruptcy but the business community will not be able to survive from
bankruptcy. Let us see how we cope with the pandemic in the light of the
government’s expenditures have been increased as the government has taken
several steps including cutting the interest rate by 2.25%, petrol prices by
Rs15 per liter and introducing an Rs150 billion aid package for the poor and
labour classes. I expect that this finical will become double in the coming
days. Unfortunately, the wheels which get aye economic abilities have now come
to standstill due to COVID-19 and this pandemic has shut the transport from
train service till airplane service everything has been closed down by the
government which is actually making it very difficult for the government to
generate revenue. Tourism has also gone down to zero in the country since the
virus outbreak. This ball of virus either manmade or natural has been set on
rolling and destroying the economy of every country. It looks God has snatched
the self-styled titles of world power and all of us can see the touch of
interfaith harmony and everyone is looking towards Almighty Allah forgiveness.
May God grant all of the forgiveness and give our world back to us. China might
benefit greatly after the crisis is over as it was the first country to be
infected by the virus and to get out of it. The countries with the technocratic
authoritarian model as China, Japan, Singapore and to some extent South Korea
are dealing more effectively with the virus than the democratic ones like the
Western and South Asian ones. These countries have efficiently tackled the
disinformation elements in society to stop the spread of chaos and panic. While
on the other hand, people in democratic societies who care about freedom,
privacy, and individual rights, are much worried about their freedom after
COVID-19 is over. It is yet to see which economy bears the more shocks and
blows and which survives the less, as the pandemic is increasing rapidly and
policies are changing and developing every now and then to deal with the
crisis. The coronavirus has obviously brought irreversible loss to the world
economy. China’s Hubei province after suffering heavily has been able to cope
with it because of its larger stronger economy. It has now spread its wings
globally and there are now significant outbreaks around the world from South
Korea to Italy, Australia, France, Germany and almost all of Asia.
The situation of pandemic predicts that the Gross Domestic
Product (GDP) of the United States and China will decline by 2.4 percent, Japan
by 2.7, Germany by 3.6 and the Russian economy will decline by 4.8%. In April
2020, almost every G20 member state made an attempt to minimise coronavirus
pandemic effects for their respective nations. Out of all G20 countries, the US
has passed the largest fiscal stimulus package that amounts to about 11 percent
of its GDP amounting to about 2.3 trillion US dollars. Canada announced the
stimulus package of 8.4% of its GDP, Germany of 4.9%, and Russia of 1.5 and
China of only 1.2% since it has nearly taken control over the virus. China’s
economy in 2020 has expanded by 3.5% only which is the slowest in records back
to 1980. The world has now entered the scenario 3 of coronavirus since it
became a pandemic in scenario 2 and as of now, all the countries that had
reported any cases as of the start of March i.e. the US, India, Pakistan the
UK, Canada, and Brazil are facing an increase in its number. We the global
village citizen are standing helplessly as the invisible enemy continues to
attack and pushing the world to a blind end. Pakistan needs to move requests to
all the donators either to wave off our debts or give relief of 10 years
interest-free period in view of this devastating COVD-19 pandemic.
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