Major dip in exports and imports in July shrinks trade deficit

• Pakistani exports and imports fell by double digits in July.
• July trade bulletin reveals goods exports amounted to over $2bn. 
• Decline partly attributed to import ban to manage dollar shortage.

ISLAMABAD: Pakistani exports and imports fell by double digits in July, registering a major decline as compared to the previous month, The News reported, citing the Pakistan Bureau of Statistics (PBS) data.

As per the PBS data, the exports dropped 12.7% in the first month of the current fiscal, while the month-on-month drop was 8.6%.

PBS data showed that imports also witnessed a substantial decrease of 13.75% compared to the previous month and 26.4% compared to the same month a year ago.

The trade bulletin for July 2023 revealed that goods exports amounted to $2.057 billion, down from $2.356 billion in June 2023 and $2.25 billion in July 2022. Meanwhile, goods imports in July 2023 were valued at $3.66 billion, down from $4.2 billion in June 2023 and $4.98 billion in July 2022.

This decrease in imports helped reduce the trade deficit by 41.2% to $1.61 billion in July 2023 compared to $2.73 billion in July 2022.

In June 2023, the trade gap was $1.86 billion.

The decline in imports was partly attributed to the government’s decision to ban several luxury items in an effort to manage the dollar shortage in the economy.

Throughout the fiscal year 2022-23, the country saw a significant reduction in the trade deficit, which shrunk by 43% to $27.55 billion, down from $48.35 billion in the previous fiscal year. During the same period, total exports declined by 12.7%, reaching $27.7 billion, while imports shrank by 31%, amounting to $55.3 billion.

The PBS also reported the services trade performance data for July-June 2022-23. According to the trade statistics for international services during this period, local companies imported more services than they exported.

The trade deficit in services witnessed a remarkable decrease of 87.7%, reaching $719.4 million in FY23 compared to $5.84 billion in FY22.

In FY23, the economy hired the services of foreign companies for $8.02 billion and exported services abroad for $7.3 billion. 

In FY22, the country’s services exports were recorded at $7.1 billion, and imports stood at $12.9 billion, representing an increase of 2.78% in services exports and a 38% decline in imports.

In June 2023, services exports were valued at $571 million, while imports amounted to $655 million, resulting in a deficit of $84 million. In May 2022, exports were recorded at $607 million, imports at $903 million, and the deficit at $296 million. 

During the month under review, services exports decreased by 5.9%, and imports decreased by 27.5% compared to the previous month. Comparing June 2023’sservices to the trade performance of the same month the previous year, exports were down by 14%, and imports shrunk by 50.7%.

In June 2022, services exports amounted to $664 million, and imports reached $1.328 billion, resulting in a deficit of $664.9 million.

In June 2023, the services trade deficit was recorded at $84 million, marking a reduction of 87.4% compared to the corresponding month of the previous year.