Three years ago, Pakistan teetered on the edge of economic collapse. Credit rating agencies delivered a devastating verdict, with S&P downgrading the country to ‘CCC+’ in December 2022 as foreign reserves crashed to a multi-year low of just $6.7 billion. The message from global markets was clear: Pakistan had become uninvestable.
The eurobond market laid bare the severity of the crisis. Pakistan’s dollar bond was trading at fire-sale prices as investors scrambled to exit what many had written off as certain default territory. The country appeared destined to join the growing list of emerging market casualties: Sri Lanka, Ghana, and Zambia.
The crisis was years in the making, but 2022 delivered the perfect storm. Russia’s invasion of Ukraine sent oil prices soaring past $130 per barrel, devastating floods submerged one-third of the country, and the dramatic ousting of Prime Minister Imran Khan in April 2022 plunged domestic politics into chaos. The rupee collapsed, inflation exploded to nearly 30%, and the government’s financing options evaporated as foreign reserves dwindled to cover barely one month of imports.
Yet Pakistan’s story has taken a remarkable turn. The economy that seemed beyond salvation is not only surviving but showing genuine signs of recovery. The panic that gripped markets in 2022 has given way to cautious optimism and this shift is being validated by the very rating agencies that once wrote Pakistan off. The content in this publication is expensive to produce. But unlike other journalistic outfits, business publications have to cover the very organizations that directly give them advertisements. Hence, this large source of revenue, which is the lifeblood of other media houses, is severely compromised on account of Profit’s no-compromise policy when it comes to our reporting. No wonder, Profit has lost multiple ad deals, worth tens of millions of rupees, due to stories that held big businesses to account. Hence, for our work to continue unfettered, it must be supported by discerning readers who know the value of quality business journalism, not just for the economy but for the society as a whole.To read the full article, subscribe and support independent business journalism in Pakistan
