Pakistan posts highest current account surplus in 10 years

The State Bank of Pakistan (SBP) reported on Tuesday that Pakistan’s current account showed a surplus of $729 million in November 2024.

This is a significant improvement from the $346 million surplus in October 2024 and a shift from the $148 million deficit in November 2023. The surplus reflects a reduction in trade and services deficits, along with lower interest and dividend repatriations. 

This also marks the fourth consecutive month of a current account surplus for the country. In the first five months of fiscal year 2025, Pakistan posted a cumulative surplus of $944 million, compared to a deficit of $1.67 billion during the same period last year. 

A key driver of this improvement was a 14% reduction in the trade deficit, which decreased to $1.361 billion, and a 43% drop in the services deficit to $152 million. Additionally, goods imports decreased by 10%, while services imports fell by 13%. 

On the export front, total goods exports increased by 3% year-on-year to $2.775 billion, although they showed an 8% month-on-month decline. Remittances also showed a mixed trend. They decreased by 5% month-on-month but rose by 29% year-on-year, reaching $2.9 billion in November. 

Over the first five months of FY25, remittances totaled $14.8 billion, a 34% increase compared to the previous year. This improvement follows Pakistan’s crackdown on informal dollar trading.

The State Bank of Pakistan (SBP) has forecasted a significant surplus for FY25, with remittances showing an upward trend. Prime Minister Shehbaz Sharif praised the current account surplus as a positive indicator for Pakistan’s economy and expressed confidence in further economic growth, citing reduced interest rates and improved investor confidence as key factors.