Pakistan opens factories despite lockdown to prevent exports from crashing
Pakistan is reopening some factories amid a national lockdown to counter the deadly coronavirus pandemic as the south Asian nation expects its exports will decline by 50% in the next two months.
The companies with export orders will start working again with precautionary measures including calling in only essential employees and ensuring regular disinfection, Abdul Razak Dawood, the commerce adviser said in a phone call, late Thursday. Exporters such as Interloop Ltd., which supplies to Nike Inc. and Puma SE, have reopened their factories.
The International Monetary Fund plans to approve and disburse an additional $1.4 billion in emergency financing to Pakistan next week to help the nation shield its economy. This is in addition to Prime Minister Imran Khan, who has warned the pandemic may spread in coming weeks, announcing multiple stimulus packages including its largest-ever cash payouts and for the reopening of the construction industry starting next week.
Pakistan’s decision to reopen some factories
comes after a global slowdown and the IMF predicting the world economy this year will suffer its worst recession since the Great Depression. A Bloomberg survey forecast Pakistan’s $315 billion economy will expand 0.8% this year, compared with the earlier forecast of 2.6%. The country’s exports fell 8.5% in March.
Sapphire Fibres Ltd., Sapphire Textile Mills Ltd., Indus Dyeing and Manufacturing Co. and Din Textile Ltd. rose by 7.5% daily limit in Karachi.
Pakistan had pinned its hopes of getting out of its regular economic boom and bust cycle through exports but they will fall by as much as 50% over the next couple of months, Dawood said. There will be a “slow recovery, very slow recovery,” he added.
The virus outbreak has infected 4,489 people and 63 have died amid low testing in Pakistan. The government has said it will take a decision on April 14 whether to extend the nationwide partial lockdown.
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