$3.23 billion deficit recorded in fiscal year 2009

KARACHI: The country registered a deficit of $3.23 billion in services trade in the fiscal year 2008-09 mainly due to high payments on account of transportation, travel and financial services. However, overall services sector trade performance was sufficient as imports and deficit declined, while exports posted a massive increase during the fiscal year. The country s services sector deficit stood at 3.231 billion dollars during 2008-09, as overall services exports amounted to 4.043 billion dollars as against imports of 7.274 billion dollars. However, services sector deficit in fiscal year 2009 was 50 percent lower than last fiscal year s, in which country posted deficit of 6.457 billion dollars.
Overall exports of services sector performed well and witnessed a growth of 13 percent, while imports showed a decline of 28 percent. Services sector exports mounted to 4.043 billion dollars in the year as against exports of 3.589 billion dollars in fiscal year 2008, depicting an increase of 454 million dollars. Imports of services sector registered a decline of 2.772 billion dollars at 7.274 billion dollars against 10.046 billion dollars in fiscal year 2008. Meanwhile, services deficit in June 2009 stood at 251 million dollars with 326 million dollars exports and 577 million dollars imports. The country earned 1.283 billion dollars on account of transportation services, 222 million dollars from travel, 196 million dollars in communication sector, 59 million dollars in insurance and 63 million dollars from financial sector in fiscal year 2009.
Payments for travel stood at 3.527 billion dollars, communication 144 million dollars, construction 81 million dollars, insurance 127 million dollars, financial services 168 million dollars and computer and information services payment reached 122 million dollars during the period. Similarly, payments of royalties and licence fees stood at 93 million dollars, government services 380 million dollars and cultural services payment 3 million dollars. Economists said heavy payments of transportation, travel, insurance, technical fee, royalties and government sector were the major contributors in the services trade deficit, which could be controlled with some steps. However, they believed that rising trend in the services exports and decline in imports would further reduce the services sector deficit in the current fiscal year. They said that decline in services sector deficit had also helped to curb the rising current account deficit.

Courtesy: Business Recorder

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