akistan stands out globally as the most improved economy in terms of reduction in sovereign default risk, measured by CDS [Customs Declaration Systems] implied probability, claims the latest data posted by Bloomberg Intelligence, according to a statement by Advisor to the Finance Minister Khurram Schehzad on June 28.

His statement added, `The country has topped the Global Emerging Markets rankings with the largest drop in sovereign default risk globally over the last 12 months.

[The] default probability [went] down from 59 per cent to 47pc, a massive 1,100 basis points improvement.` In the week ending on June 28, Pakistan and China signed $3.7 billion worth of commercial loans that `would pull the foreign exchange reserves back in double digits on June 30 from the critically low level of $8.9bn in the previous week,` says an analyst. The deals could also help meet a commitment with the International Monetary Fund (IMF) to close fiscal year 2024-25 with $14bn foreign exchange reserves; the reserves have been increased by external bilateral, multilateral and commercial dollar borrowings, debts re-rolling, inflows of bilateral foreign deposits, etc.

Since 2020, developing nations have been forced to borrow at interest rates two to four times higher than those available to the United States, according to a report by theUnited Nations Conference on Trade and Development. Since 2010, the report adds, public debt in developing countries has grown twice as fast as in advanced economies, while systemic inequalities in global financial systems have further exacerbated the crisis.

Global public debt rose to $102 trillion in 2024, with developing countries accounting for nearly one-third, or $31tr, of that total, but these countries paid a record $921bn in interest payments, severely straining public finance and threatening public services.

Even with IMF-required levels of forex reserves, the domestic foreign market is facing a dollar shortage. The edible oil industry is on the brink of a major crisis due to a severe dollar shortage in commercial banks causing delays in clearance of import documents for edible oil shipments, according to Vanaspati Manufacturer Association Chairman Sheikh Umer Rehan. In a statement, Mr Rehan said international suppliers are becoming increasingly reluctant to accept new orders from Pakistan, further disrupting the sup-ply chain and compounding the difficulties faced by local manufacturers of Vanaspati ghee and cooking oil.

`Several shipments of imported oil are currently stuck at ports as banks are not releasing the required documents,` he said, adding, `If immediate action is not taken, the situation could escalate into a fullblown crisis for both the industry and consumers.` The export proceeds have recorded a negative growth for the past three consecutive months June (0.59pc), May (10.07pc) and April (7.36pc) according to data released by the Pakistan Bureau of Statistics on July 1. Imports grew 6.57pc to $58.38bn in July-June FY25 from $54.78bn over the last year. The trade deficit in July-June FY25 increased by 9pc to $26.27bn from $24.11bn in the year before; however, in June, the deficit decelerated by 3.45pc to $2.32bn from $2.41bn last year.

The current account posted a deficit of $103 million in May against a surplus of $47m (revised) last month, data released by the State Bank showed. In the first eleven months of FY25, a current account surplus was recorded at $1.81bn, in sharp contrast to a huge deficit of $1.57bn in the comparative period of the previous fiscal year.

Efforts have been initiated to encourage overseas Pakistanis to remit funds through official channels. According to a statement, the CEO of UK-based ACE Money Transfer, Rashid Ashraf, conducted a series of strategic meetings in Islamabad with Finance Minister Muhammad Aurangzeb and other senior government officials to discuss collaborative efforts aimed at strengthening Pakistan`s financial infrastructure. A key focus of discussion was the development of structured incentive programmes to encourage overseas Pakistanis to remit funds through official channels to increase annual remittance to $50bn within five years.

Despite official estimates of GDP growth at 2.7pc for FY25, more people have been seeking better job opportunities abroad. `In May 2025, the Bureau of Emigration & Overseas Employment registered 59,995 workers, a 12.7pc increase from 53,231 in April,` stated the monthly Economic Outlook report of the finance ministry for June.

Overall, about 285,370 people left Pakistan to find better opportunities overseas during the January-May period of 2025.

Owing to rising overseas migration and a shift of informal transfers to formal channels, remittances rose by 28pc to $34.9b during July-May. The major increases in inflows were recorded from Saudi Arabia and the United Arab Emirates at 20.4pc.

There is some comfort in the parliament`s role, to quote an analyst, in making the draft Finance Bill `more peopleand business-friendly and less autocrat in tone far from ideal, it was nonetheless a step forward`. And on the external front, the IsraelIran ceasefire was good news.

`The US blundered into an unnecessary war,` says political, security and defence analyst Shahzad Chaudhry in an opinion piece for The Express Tribune, observing that every war has a purpose and that this one served none. Though `Iran has recovered its dignity and respect as a nation having gone through the test`, he wrote.m