‘Moody’s reconfirmation is testimony of Pakistan’s V-shaped recovery’

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ISLAMABAD: Federal Minister for Planning and Development Asad Umar tweeted this morning (Saturday) that assigning of ‘stable’ outlook to Pakistan by Moody’s Investor Services is a ‘testimony’ to the country’s ‘V-shaped’ recovery in coronavirus pandemic.

“Moody’s reconfirmed Pakistan’s credit rating with a stable outlook. In the middle of a global pandemic it is a testimony to the V shaped recovery Pakistan has seen with PM Imran Khan balanced approach to safeguarding national health & livelihoods, delivering success on both counts,” Umar wrote in a tweet post.

Moody’s Investors Service on Saturday confirmed Pakistan’s B3 credit rating with the outlook at stable, as it concludes the review for downgrade initiated on 14 May 2020. The stable outlook reflects Moody’s view that the pressures Pakistan faces in the wake of the coronavirus shock and prospects for its credit metrics in general are likely to remain consistent with the current rating level, the rating agency said.

The rating agency said it expects Pakistan’s economic growth to be positive but will be low around 1 per cent-2 per cent for the ongoing fiscal year 2020-21 ending June 2021 after experiencing a recession in the previous fiscal year 2019-2020.

It added that Pakistan’s economy was relatively closed with a low reliance on exports and movement restrictions due to the pandemic will keep economic activity below the pre-outbreak levels for some time.

Meanwhile, Moody’s shared that the slow economic recovery will impact government revenue, keeping the fiscal deficit wide at around 8-8.5 per cent of GDP in the ongoing fiscal year (FY21) which will be at similar levels compared to FY20.

 

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