Repatriation of profits and dividends by multinational companies reached $274.7 million during July-August of FY25, more than fivefold up compared to $49.2 million in the same period last year.
The State Bank of Pakistan (SBP) reported that in FY24, $135.6 million was repatriated in August, slightly down from the $139.1 million seen in July.
June had a notable outflow of $415 million, largely due to year-end clearance of payments.
The first half saw subdued outflows, but the second half experienced substantial improvement. By the close of FY24, the total outflows amounted to $2.12 billion, a stark contrast to the $331 million in FY23.
Sector-wise data reveals that the financial sector (banks) led the outflow with $59.6 million in the first two months of FY25, compared to just $3.7 million in the same period last year.
The tobacco and cigarette sector followed with $43.1 million, food at $34.9 million, transport at $36 million, and power at $32 million. None of these sectors had any recorded outflows during the same period last year.
Country-wise, the highest remittances of $93.2 million were sent to the United Kingdom. China, despite being the largest investor in Pakistan, saw the lowest outflow at $20.5 million in the period. The UAE, US, and France recorded outflows of $33.1 million, $32.5 million, and $30.6 million, respectively.
The restrictions on dollar outflows imposed by the SBP during FY23 and part of FY24 had drawn criticism from multinational corporations, with the International Monetary Fund (IMF) eventually stepping in to facilitate smoother outflows. These policies impacted the country’s image and foreign investment sentiment.
In related news, the SBP’s foreign exchange reserves rose by $24 million to $9.533 billion while total liquid reserves stood at $14.873 billion for the week ending on September 20.
