July-December: Remittances slide down 2.27% year-on-year

KARACHI: 

Overseas Pakistanis sent remittances amounting to $9.46 billion in the first six months (July to December) of 2016-17, down 2.27% compared with $9.68 billion the country received during the same period in the preceding year, according to data released by the State Bank of Pakistan (SBP) on Tuesday.

Pakistan’s remittances, like many other developing countries, have come under pressure due to world economic slowdown mainly because of low crude oil prices.

Remittances play a major role in stabilising Pakistan’s external sector, as they make up almost half the import bill and cover deficit in the trade of goods account.

During December 2016, the inflow of worker’s remittances amounted to $1.58 billion, down 1.2% compared with November 2016 and December 2015.

Country wise breakup

Inflows from Saudi Arabia were the largest source of remittances in Nov-Dec. They amounted to $475.75 million, down from $501.99 million the preceding fiscal last year.

Remittances received in December from the United Arab Emirates (UAE) increased to $339.93 million on a year-on-year basis.

Inflows from USA and UK decreased from $208 million and $190.57 million to 182.17 million and $181.85 million, respectively.

Remittances from Gulf Cooperation Council (GCC) countries, excluding Saudi Arabia and the UAE, clocked in at $203.63 million, down from$209.5 million than the remittances received from these countries in the same months of the preceding fiscal year.

Remittances from EU countries in Nov-Dec equalled $35.08 million.

Additionally, remittances received from Norway, Switzerland, Australia, Canada, Japan and other countries during December 2016 amounted to $165.76 million together compared with $131.24 million received in December 2015.

Pakistan received remittances amounting to $19.9 billion in 2015-16, up 6.4% from the previous year.

Declining exports and a gradual slowdown in remittances are major challenges for economic managers of the country. However, the State Bank of Pakistan (SBP) is confident that the country faces no immediate threat from the slowdown in remittances and it is in a much better position to repay debts in the next four to five years.

Published in The Express Tribune, , January 11th, 2017