Home

Afghanistan vs. Pakistan

Economy

AfghanistanPakistan
Economy - overviewAfghanistan is gradually recovering from decades of conflict. Before 2014, the economy had sustained nearly a decade of strong growth, largely because of international assistance. Since 2014, however, the economy has slowed, in large part because of the withdrawal of nearly 100,000 foreign troops that had artificially inflated the country’s economic growth. Despite improvements in life expectancy, incomes, and literacy since 2001, Afghanistan is extremely poor, landlocked, and highly dependent on foreign aid. Much of the population continues to suffer from shortages of housing, clean water, electricity, medical care, and jobs. Corruption, insecurity, weak governance, lack of infrastructure, and the Afghan Government's difficulty in extending rule of law to all parts of the country pose challenges to future economic growth. Afghanistan's living standards are among the lowest in the world.

The international community remains committed to Afghanistan's development, pledging over $83 billion at ten donors' conferences between 2003 and 2016. In October 2016, the donors at the Brussels conference pledged an additional $3.8 billion in development aid annually from 2017 to 2020. Despite this help, the Government of Afghanistan will need to overcome a number of challenges, including low revenue collection, anemic job creation, high levels of corruption, weak government capacity, and poor public infrastructure.

In 2017 Afghanistan's growth rate was only marginally above that of the 2014-2016 average. The drawdown of international security forces that started in 2012 has negatively affected economic growth, as a substantial portion of commerce, especially in the services sector, has catered to the ongoing international troop presence in the country. Afghan President Ashraf GHANI Ahmadzai is dedicated to instituting economic reforms to include improving revenue collection and fighting corruption. However, the reforms will take time to implement and Afghanistan will remain dependent on international donor support over the next several years.
Decades of internal political disputes and low levels of foreign investment have led to slow growth and underdevelopment in Pakistan. Pakistan has a large English-speaking population. Nevertheless, a challenging security environment, electricity shortages, and a burdensome investment climate have deterred investors. Agriculture accounts for one-fifth of output and two-fifths of employment. Textiles and apparel account for most of Pakistan's export earnings; Pakistan's failure to diversify its exports has left the country vulnerable to shifts in world demand. Pakistan’s GDP growth has gradually increased since 2012. Official unemployment was 6% in 2017, but this fails to capture the true picture, because much of the economy is informal and underemployment remains high. Human development continues to lag behind most of the region.

In 2013, Pakistan embarked on a $6.3 billion IMF Extended Fund Facility, which focused on reducing energy shortages, stabilizing public finances, increasing revenue collection, and improving its balance of payments position. The program concluded in September 2016. Although Pakistan missed several structural reform criteria, it restored macroeconomic stability, improved its credit rating, and boosted growth. The Pakistani rupee, after heavy depreciation in 2013, remained relatively stable against the US dollar in 2015-17. Low global oil prices in 2016 contributed to a narrowing current account deficit and lower inflation. Remittances from overseas workers continued to be a key revenue source, also mitigating the impact of the lack of foreign investment and a growing trade deficit on the country’s current account.

Pakistan must continue to address several longstanding issues, including expanding investment in education and healthcare, adapting to the effects of climate change and natural disasters, improving the country’s business environment, reducing dependence on foreign donors, and widening the country’s tax base. Given demographic challenges, Pakistan’s leadership will be pressed to implement economic reforms, promote further development of the energy sector, and attract foreign investment to support sufficient economic growth necessary to employ its growing and rapidly urbanizing population, much of which is under the age of 25.

In an effort to boost development, Pakistan and China are implementing the “China-Pakistan Economic Corridor,” a $46 billion investment program targeted towards the energy sector and other infrastructure projects that Islamabad and Beijing had agreed on in early 2013.
GDP (purchasing power parity)$69.51 billion (2017 est.)
$67.81 billion (2016 est.)
$66.25 billion (2015 est.)
note: data are in 2017 dollars
$1.056 trillion (2017 est.)
$1.003 trillion (2016 est.)
$960.2 billion (2015 est.)
note: data are in 2017 dollars
data are for fiscal years
GDP - real growth rate2.5% (2017 est.)
2.4% (2016 est.)
1.3% (2015 est.)
5.3% (2017 est.)
4.5% (2016 est.)
4.1% (2015 est.)
note: data are for fiscal years
GDP - per capita (PPP)$1,900 (2017 est.)
$2,000 (2016 est.)
$2,100 (2015 est.)
note: data are in 2017 dollars
$5,400 (2017 est.)
$5,200 (2016 est.)
$5,100 (2015 est.)
note: data are in 2017 dollars
data are for fiscal years
GDP - composition by sectoragriculture: 22%
industry: 22%
services: 56%
note: data exclude opium production (2015 est.)
agriculture: 24.7%
industry: 19.1%
services: 56.3% (2017 est.)
Population below poverty line35.8% (2011 est.)
29.5% (FY2013 est.)
Household income or consumption by percentage sharelowest 10%: 3.8%
highest 10%: 24% (2008)
lowest 10%: 4%
highest 10%: 26.1% (FY2013)
Inflation rate (consumer prices)6% (2017 est.)
4.4% (2016 est.)
4.1% (2017 est.)
2.9% (2016 est.)
Labor force7.983 million (2013 est.)
63.89 million
note: extensive export of labor, mostly to the Middle East, and use of child labor (2017 est.)
Labor force - by occupationagriculture: 78.6%
industry: 5.7%
services: 15.7% (FY08/09 est.)
agriculture: 42.3%
industry: 22.6%
services: 35.1% (FY2015 est.)
Unemployment rate35% (2008 est.)
40% (2005 est.)
6% (2017 est.)
6% (2016 est.)
note: substantial underemployment exists
Budgetrevenues: $1.992 billion
expenditures: $6.636 billion (2016 est.)
revenues: $45.64 billion
expenditures: $59.28 billion
note: data are for fiscal years (2017 est.)
Industriessmall-scale production of bricks, textiles, soap, furniture, shoes, fertilizer, apparel, food products, non-alcoholic beverages, mineral water, cement; handwoven carpets; natural gas, coal, copper
textiles and apparel, food processing, pharmaceuticals, surgical instruments, construction materials, paper products, fertilizer, shrimp
Industrial production growth rate2.4% (2014 est.)
5% (2017 est.)
Agriculture - productsopium, wheat, fruits, nuts; wool, mutton, sheepskins, lambskins, poppies
cotton, wheat, rice, sugarcane, fruits, vegetables; milk, beef, mutton, eggs
Exports$619.2 million (2016 est.)
$580 million (2015 est.)
note: not including illicit exports or reexports
$21.7 billion (2017 est.)
$21.71 billion (2016 est.)
Exports - commoditiesopium, fruits and nuts, handwoven carpets, wool, cotton, hides and pelts, precious and semi-precious gems
textiles (garments, bed linen, cotton cloth, yarn), rice, leather goods, sporting goods, chemicals, manufactures, surgical instruments, carpets and rugs
Exports - partnersPakistan 46.3%, India 37.6% (2016)
US 16.3%, China 7.6%, UK 7.4%, Afghanistan 6.5%, Germany 5.7% (2016)
Imports$6.16 billion (2016 est.)
$7.034 billion (2015 est.)
$48.21 billion (2017 est.)
$41.62 billion (2016 est.)
Imports - commoditiesmachinery and other capital goods, food, textiles, petroleum products
petroleum, petroleum products, machinery, plastics, transportation equipment, edible oils, paper and paperboard, iron and steel, tea
Imports - partnersIran 19.3%, Pakistan 18.3%, China 16.7%, Kazakhstan 9.5%, Uzbekistan 6.1%, Turkmenistan 5.4%, Malaysia 4% (2016)
China 29.1%, UAE 13.2%, Indonesia 4.4%, US 4.3%, Japan 4.2% (2016)
Debt - external$1.28 billion (FY10/11)
$2.7 billion (FY08/09)
$75.66 billion (31 December 2017 est.)
$70.45 billion (31 December 2016 est.)
Exchange ratesafghanis (AFA) per US dollar -
67.87 (2016 est.)
67.87 (2016 est.)
67.87 (2015)
61.14 (2014 est.)
57.25 (2013 est.)
Pakistani rupees (PKR) per US dollar -
105.1 (2017 est.)
104.769 (2016 est.)
104.769 (2015 est.)
102.769 (FY2014 est.)
101.1 (FY2013 est.)
Fiscal year21 December - 20 December
1 July - 30 June
Public debt8.3% of GDP (2016 est.)
9.3% of GDP (2015 est.)
59.4% of GDP (2017 est.)
59.5% of GDP (2016 est.)
Reserves of foreign exchange and gold$6.477 billion (31 December 2016 est.)
$6.232 billion (31 December 2015 est.)
$20.02 billion (31 December 2017 est.)
$22.05 billion (31 December 2016 est.)
Current Account Balance$999 million (2017 est.)
$1.372 billion (2016 est.)
-$11.67 billion (2017 est.)
-$4.867 billion (2016 est.)
GDP (official exchange rate)$21.06 billion (2016 est.)
$278.9 billion (2015 est.)
Market value of publicly traded shares$NA
$43.68 billion (31 December 2012 est.)
$32.76 billion (31 December 2011 est.)
$38.17 billion (31 December 2010 est.)
Commercial bank prime lending rate15% (31 December 2016 est.)
15% (31 December 2015 est.)
7% (31 December 2017 est.)
6.94% (31 December 2016 est.)
Stock of domestic credit$-240.6 million (31 December 2016 est.)
$-240.6 million (31 December 2016 est.)
$165.2 billion (31 December 2017 est.)
$145.2 billion (31 December 2016 est.)
Stock of narrow money$6.644 billion (31 December 2014 est.)
$6.192 billion (31 December 2013 est.)
$117.2 billion (31 December 2017 est.)
$103.5 billion (31 December 2016 est.)
Stock of broad money$6.945 billion (31 December 2014 est.)
$6.544 billion (31 December 2013 est.)
$142 billion (31 December 2017 est.)
$126.8 billion (31 December 2016 est.)
Taxes and other revenues9.5% of GDP (2016 est.)
14.9% of GDP (2016 est.)
Budget surplus (+) or deficit (-)-22.1% of GDP (2016 est.)
-4.5% of GDP (2016 est.)
GDP - composition, by end usehousehold consumption: 108.6%
government consumption: 12.8%
investment in fixed capital: 18.2%
investment in inventories: 0%
exports of goods and services: 6.6%
imports of goods and services: -46.2% (2014 est.)
household consumption: 81.8%
government consumption: 11.9%
investment in fixed capital: 14.2%
investment in inventories: 1.6%
exports of goods and services: 8.3%
imports of goods and services: -17.8% (2017 est.)
Gross national saving22.7% of GDP (2017 est.)
25.5% of GDP (2016 est.)
21.4% of GDP (2015 est.)
11.8% of GDP (2017 est.)
13.8% of GDP (2016 est.)
14.7% of GDP (2015 est.)
note: data are for fiscal years

Source: CIA Factbook