A recent Gallup Pakistan survey reveals that business confidence in Pakistan has improved, yet many still question the country’s overall direction.
According to the Gallup Pakistan Business Confidence Index Q4 2024, 55% of business owners rated their current business conditions as “good” or “very good,” reflecting a 10% increase from the last survey conducted in Q2 2024. Additionally, the number of businesses that previously rated their situation as “very bad” has dropped by 7%.
Optimism for the Future
Business expectations for the future are also on the rise. The survey found that 60% of businesses expect positive growth in the coming months, marking a 19% increase from six months ago. The Net Future Business Confidence Score has improved by 36% compared to Q2 2024.
The report attributes this shift to factors such as declining inflation, macroeconomic stability, and interest rate cuts, which have contributed to reduced pessimism among business owners.
Sectoral Performance
- The services and trade sectors have shown greater recovery compared to the manufacturing sector, which continues to struggle.
- More service-based businesses have reduced their workforce compared to manufacturers and traders.
Challenges & Economic Management
Despite growing confidence in business performance, concerns remain regarding the country’s overall direction. The report suggests that this uncertainty may be influenced more by political instability rather than economic management.
When asked which government handled the economy better:
- 41% of respondents credited the ruling Pakistan Muslim League-Nawaz (PML-N) government.
- 38% believed former Prime Minister Imran Khan’s government performed better.
- 21% saw no difference between the two administrations.
The top concern for business owners remains inflation, with 30% of respondents citing it as the most pressing issue the government needs to address.
Survey Methodology
This survey is the 14th edition of Gallup Pakistan’s quarterly Business Confidence Survey, conducted in over 30 districts, covering 482 small, medium, and large businesses across various sectors.
While confidence in business operations has improved, uncertainty over the broader economic and political landscape continues to shape investor sentiment in Pakistan.
