Pakistan’s estimated economic loss due to massive floods might be over $40 billion: Minister

ISLAMABAD: Recent devastating floods have wreaked havoc Pakistan could have caused more than $40 billion in damage and economic loss, according to initial estimates.
The new number is even much higher than the 30 billion USD figure due to United Nation general secretary Antonio Guterres who were in the country on a solidarity visit last week.
The $40 billion damage figure was highlighted during a flood response center meeting of the National Flood Response Coordination Center (NFRCC) on Monday, where the financial presented an assessment report titled “Early Assessment of Flood Impact on Pakistan Economy,” the Express Tribune reported on Tuesday.
The the financialThe initial assessment report showed economic losses of about $18 billion.
Minister of Planning and Chairman of the NFRCC, Ahsan Iqbal “Devastating conditions suggest that the scale of flood damage ranges from $30 billion to more than $40 billion,” it said.
“We are going through a comprehensive flood damage assessment with the help of the World Bank, Asian Development Bank, provincial and federal governments,” said Iqbal.
The Planning Minister said the Finance Ministry had presented an initial assessment of flood damage, which was based on predictive analysis but that the outcome of the model would depend on what inputs were included.
“The NFRCC has directed the Treasury Department to withhold the release of its flood impact report,” he added.
The NFRCC president said: “We will wait for the results of the comprehensive assessment but the damage is huge and even more than 30 billion USD as proposed by the UN secretary general.
According to government estimates, Pakistan’s GDP is also gradually decreasing in the fiscal year 2022-2023 and is likely to fall between 3% and 5%. Before the floods, the Ministry of Finance had set a target of 5% economic growth.
The IMF will consider any easing in Pakistan’s $6.5 billion bailout program on the basis of a credible assessment of the damage.
More than 33 million people have been affected by the floods and who are in immediate need of assistance, far more than the initial cash amount of Rs 25,000.
According to an official from the Ministry of Finance, who was involved in the preparation of the initial assessment report.
Preliminary reports suggest that the overall loss in GDP growth will be between 3.3% and 3.7% due to flooding.
But if losses are adjusted to $40 billion, the economy will shrink, according to the sources. The interim report shows that about 20% of the Public Sector Development Program (PSDP), or Rs 218 billion, will have to be diverted to disaster relief spending, resulting in an additional 600,000 unemployed due to the spending. short.
In its interim report, the Treasury Department reduced the negative impact on the trade deficit caused by flooding from an initial $4 billion to $2 billion.
It did not give a figure for the additional impact on the current account deficit, although it had previously put a figure between $4 and $5 billion.
“Flood damage to crops, livestock, infrastructure and the expected decline in economic activities will have an impact on the external sector,” reads the report without giving out numbers.
The report by the Ministry of Finance said the devastating floods had disproportionately affected the poor and vulnerable groups in society.
According to The Express Tribune, falling GDP growth and other damage to the economy will further exacerbate poverty in the country, pushing an additional 9-12 million people into poverty.
Pakistan is a victim of global warming, although its contribution is less than 1%.
The country is expected to receive great support from developed nations during the upcoming United Nations Conference on Climate Change, COP27, scheduled to take place in Egypt in November.

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