Pakistan staring at massive economic crisis

The Pakistan government has estimated that 12.3 million to 18.5 million people in the country will lose their jobs and the economy will sustain massive losses in just three months due to "moderate to severe shocks from the coronavirus outbreak", it was reported on Friday.

On Thursday, the Ministry of Planning in a meeting discussed the preliminary estimates, which are based on information received from various government entities and initial research conducted by the Pakistan Institute of Development Economics, reports The Express Tribune.

Initial estimates have showed that in case of limited restrictions, about 1.4 million jobs will be lost, which are equal to 2.2 per cent of Pakistan's employed workforce.

In a moderate scenario where private offices and most shops are closed, but essential shops were open, the government has estimated that 12.3 million people would become jobless.

"On employment, we can assess that under moderate restrictions employment loss could be up to 12 million, around 20 per cent of the employed labour force," Jahanzeb Khan, the deputy chairman of the Planning Commission told The Express Tribune.

In case of a complete shutdown, the government has assessed that 18.53 million people or 30 per cent of the labour force will be unemployed.

In monetary terms, the loss of wages will translate into 561 billion Pakistani rupees for three months alone.

The Ministry also assessed losses at 1.2 trillion Pakistani rupees in a limited lockdown scenario, 1.96 trillion in moderate and 2.5 trillion in case of complete restrictions on movement, which symbolises a curfew-like situation.

"It is widely believed that the impact of the virus and severity of lockdowns on the overall economy may have a severe impact on the economic performance parameters," Khan added.

The government also expected a sharp slowdown in trade activities.

"On the trade side, there is an expected sharp slowdown in imports from 35 per cent up to 60 per cent, depending upon the severity of the crisis," Khan told The Express Tribune.

Pakistan has so far reported 2,441 confirmed coronavirus cases, with 35 deaths..