Business Confidence In Government Economic Policies Hits 4-Year High
Increased confidence reflects improvement in political and economic uncertainty from the perspective of businesses, survey
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Pakistan’s business confidence in the country’s direction has reached a 4-year high. A larger number of local businesses have also expressed confidence in the current government’s economic policies compared to the previous government.
According to Gallup Pakistan’s latest Business Confidence Survey, business confidence has improved despite the country facing challenges such as inflation, rising energy costs and load shedding in running business operations. According to the results, there has been a significant improvement in business opinion about the overall direction of the country, and the country’s direction score improved dramatically to minus 2 percent in the last quarter of 2024 compared to the survey report.
Although the score is still negative, it is at the highest level of confidence since the fourth quarter of 2021.
According to the survey, the increase in business confidence reflects an improvement in the political and economic uncertainty from the perspective of businesses and there has been a significant increase in the number of businesses that have a positive perception of the current government’s ability to handle the economy.
According to the survey, 46 percent of businesses have expressed confidence in the current government’s economic policies compared to the Pakistan Tehreek-e-Insaf, while this rate was 24 percent a year ago. With a 6 percent improvement compared to the previous survey, 61 percent of the survey participants rated current business operations as good or very good.
In addition, there has been a significant improvement in the services and trade sectors, while the pace of recovery in the manufacturing sector is relatively slow. 61 percent of the participants are optimistic about the future, but this confidence has improved only one point compared to the previous survey, which reflects that although businesses do not fear a deterioration in the situation, the pace of improvement is also very slow.
In response to a question about the challenges faced by businesses, participants have identified inflation, increasing energy costs and taxes as important issues. According to the survey, 28% of the participants cited inflation, 18% high utility bills and 11% taxes as the most important problem.
Similarly, 47% of the participants confirmed load shedding, which is slightly lower than in previous years, which indicates that structural challenges still exist in the country’s business sector.
A notable positive aspect of the survey is the decrease in bribery complaints, with only 15% of the participants admitting to paying bribes in the last 6 months, compared to 34% of the participants in the last quarter of 2024.
20% of traders, 13% of the service sector and 12% of the manufacturing sector participants admitted to paying bribes. Overall, the survey showed an improvement in the perceptions of businesses on the national direction and current business conditions, however, business confidence has decreased regarding the future and challenges such as inflation, rising energy costs and governance remain key to the country’s business environment.
Gallup Pakistan Executive Director Bilal Ijaz Gilani, referring to the survey results, said that the current survey indicates a limited improvement in the confidence of the country’s businesses and reflects the stability of business stakeholders.
He said that the most notable change is the positive perception of the country’s direction and the increase in confidence in the government’s economic policies. Maintaining this trend depends on macroeconomic reforms, policy continuity and improved institutional performance.
The Gallup Pakistan Business Confidence Index 2025 Q2 survey was conducted between July 23 and 27 among 524 businesses in Pakistan across manufacturing, services and trade sectors. The survey reflects the opinions of businesses on the current business situation, government economic management and the near future.
The Gallup Business Confidence Index is an important indicator for policymakers around the world and is considered an important source of information about the opinions of businesses in a country.
