Trade deficit in services surges by 75% MoM in May

June 20, 2023 (MLN): The service sector of Pakistan posed a trade deficit of $245 million in May 2023, which soared by 75% MoM as compared to $140mn in April 2023, the monthly data released by the State Bank of Pakistan (SBP) showed.

On the other hand, the deficit narrowed by 47.08% YoY compared to a deficit of $463mn in May 2022.

Cumulatively, in 11MFY23, the trade deficit in services clocked in at $607mn, plummeting by 88.27% YoY as compared to $5.17bn in the corresponding period last fiscal year.

Details made available by SBP revealed that the exports of services in May 2023 increased by 19.81% YoY compared to $515mn in May 2022.

Amongst the total exports, telecommunications, computers, and information services made the largest contribution with an amount of $236mn, witnessing an increase of 23.56% MoM and 28.26% YoY.

This is followed by other business services that brought $142mn into the country. In terms of growth, receipts from the exports of other business services moved up by 8.4% MoM and 10.08% YoY compared to Rs131mn in April 2023 and Rs129mn in May 2022.

Moreover, the export of transport and travel services contributed an amount of $80mn and $53mn, respectively.

On the other hand, the imports of services during the month amounted to $862mn, slumped by 11.86% YoY whereas, on a monthly basis, it jumped by 31.6% MoM.

Amongst the total imports, the largest expenditure was incurred on travel services for an amount of $394mn i.e., surged by 2x MoM and 3x YoY.

Next up were other transport services which cost the country around $257mn i.e., inched up by 2.4% MoM whereas on yearly basis, it dropped by 56.59% YoY.

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