Islamabad, January 21(INP): To support enterprises in Pakistan to resume work and production in the post-epidemic era, help them understand the market dynamics and gain insight into the expectation of Pakistan’s rupee exchange rate, the webinar themed the “Outlook of Commodity & PKR Rate in Post-Epidemic Era of Covid” was held .
The Webinar was arranged by All-Pakistan Chinese Enterprises’ Association (APCEA) and Bank of China Pakistan Operations, says a report published by Gwadar Pro on Friday.
On the occasion, Mr. Li Yong, Counselor of Economic Affairs of the Chinese Embassy in Pakistan, highlighted that the construction of China Pakistan Economic Corridor(CPEC) has played a significant role in Pakistan’s economic development by improving people’s livelihood and attracting foreign investment.
He also noted that since the beginning of 2020, the five waves of COVID-19 pandemic has wreaked havoc in Pakistan. As a result, some enterprises are facing a series of problems, such as the price hike of raw materials and the devaluation of PKR.
Dr. Qazi Masood Ahmed, Professor & Director, Center for Business and Economic Research (CBER), Institute of Business Administration, introduced the exchange rate dynamics in Pakistan. In March 2020, the exchange rate in Pakistan declined by 6.7 percent to PKR 166/USD partly due to outflow of USD 1.89 million of hot money.
He predicted that PKR would depreciate to a proximity of 195 against the USD in 2022. The forecast was based on the regression analysis that takes into account the historical values.
“Factors like the current and expected changes in the trade, monetary, and fiscal policies, market-driven exchange rate regime, and the implementation of the IMF program may have downward impact on the estimated exchange rates in Pakistan.”
Mr. Cui Haitao, Assistant General Manager of Global Markets Department, Head Office of Bank of China, explained that commodities would undergo “normalisation” in 2022.
“The currency is expected to normalize as the rebound in demand is coming to an end, the demand for environmentally-friendly commodity is expected to shrink to normal, the supply crisis is expected to ease, while we have to remain alert to unexpected risks.” he added.