Global credit crisis has squeezed bigest economies like USA, Japan, Europe etc as well as minor economies leaving no exception. Giant financial institution like Lehman Brothers and others are pinned down. Unempoyment is on unsusal increase everywhere which has brought natives to streets against employment of foreigners in thier countries.
The concept of Lassiez-faire economy and Globilisation faces setback. Provision like "Buy American" and protective policies beget concept of "Economic Nationalism". Mostly counrties want investment in their homes instead of exploring foreign market so as to create jobs for locals.

Pakistan economy in three quarters of current decade of 2000 saw good gorwth. FDI, Aid and foreign remmittance poured in the coutry with records.Thanks to 9/11 and earthquake, blessing in disguise!!
Now that foreign factors i,e FDI and aid is freezing and macroeconomic imblance are at high, what challenges our economy faces and what are remedies.

Friends! kindly share your views supporting them with facts and figures

International credit crisis has slowed down the world economy
the World GDP growth was 3.4 in 2008 and 0.5 is expected in 2009
US GDP was 1.1 in 2008 and -1.6 is expected in 09
But it has some positive effects for developing economies including Pakistan
1. Decrease in the prices of major imports oil etc. will help to control inflation, and decrease in trade deficit
2. Though the workers remittances will decrease, but the citizens will try to invest in their native countries.
Now Pakistan has covered most of its trade deficit due to decrease in oil prices, and now instead of giving subsidies she is earning revenue on it.
Yet we need more to do. Unless our Govt. binds its expenditures (particularly non-development) to revenue we'll not be able to cut domestic effective demand and manage inflation, and decrease our fiscal deficit.

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