Pakistan Economy

The United States has consistently been one of the largest sources of Foreign Direct investment (FDI) in Pakistan. During FY23, foreign investors remitted $1.349 billion in profit and dividends, which is $331 million less than the previous fiscal year FY22. This 80% drop is the lowest it has been in 18 years. The reason for this decline is due to the economic slowdown, which has negatively impacted the earnings of foreign companies operating in the country.

The insufficient foreign exchange reserves have been a notable factor in the economic slowdown faced by international businesses in Pakistan, which has caused fluctuations in exchange rates, making it challenging for foreign companies to run their operations and manage finances effectively. In addition, some restrictions on foreign exchange outflows have also contributed to this significant drop.

It’s worth noting that the Oil and Gas Explorations sector had the most significant outflow of profit and dividends at $89 million, followed by the Mining sector at $46.3 million, the Power sector at $44 million, the Communication sector at $44.2 million, and the financial sector at $36.2 million.

For more information, please contact Tashfeen Mehdi, Commercial Specialist at Tashfeen.Mehdi@trade.gov.