Business confidence in Pakistan at record low

Karachi, April 8  Business confidence in Pakistan continued to slide in the first three months of 2023 amid multiple economic crises, according to the latest edition of the Gallup Business Confidence Index.

“Last year’s political instability has carried over to combine with various economic crises and exacerbated business insecurity,” Dawn news quoted the survey as saying.

Wave-9 of the survey is based on interviews with around 520 business owners conducted in the first quarter of 2023 across Pakistan.

The exercise consisted of three broad strands, namely the current business situation, the future business situation and the direction of the country. Index values dropped on a quarter-on-quarter basis to an all-time low in each of the three strands.

Two-thirds of the businesses surveyed said they faced bad or worse conditions than before. There was a 7 per cent increase in the number of businesses reporting “very bad” business conditions, Dawn reported.

With a fall of one percentage point from the preceding quarter, the Current Business Situation Score clocked in at -32 per cent.

The number of businesses saying they’d be worse off in the future increased 7 per cent from the preceding quarter.

About 61 per cent businesses said their future expectations were “negative”, while only 38 per cent expected the situation to improve.

The Future Business Confidence Score worsened by 11 percentage points to -22 per cent on a quarterly basis.

Perceptions held by the business community about the direction of the country deteriorated from -75 per cent to -79 per cent in January-March, with as many as 90 per cent of the businesses saying the country was headed in the wrong direction, Dawn reported.

Inflation remained the “most-cited problem” that most businesses (45 per cent) would like the government to solve.

Compared to the preceding quarter, a higher number of businesses wanted the government to “help with currency depreciation” even though fewer of the same respondents believed the government should provide relief on utility prices.