IT exports witness 24% surge in May 2023

IT exports witness 24% surge in May 2023

 IT exports Pakistan’s information technology (IT) exports rose by a remarkable 24% to $236 million in May 2023. This jump from the previous month is a positive sign for the IT sector, although exports showed a slight decline of 1% year-on-year year (Y/Y).

Speaking to The Express Tribune, Nasheed Malik of Topline Securities said that telecom and IT services showed remarkable month-on-month (MoM) growth of 92% and 11% respectively. In the IT service segment, exports of software grew by 14%, other services by 13% and software consulting by 8%.

According to Arif Habib Limited (AHL) research, total technology exports in May 2023 showed a significant year-on-year technology of 28%, making this the highest monthly export figure since December 2022. However, during the 11 months of FY 2023, technology exports totaled $2.369 billion, down 1% from the previous year.

While the country posted its third consecutive monthly balance of payments surplus, reaching $255 million in May 2023, experts predict the surplus will be short-lived. Amreen Soorani, head of research at JS Global Capital, said: “While the current account surplus will continue, it is still expected to be short-lived.”

According to Malik, the increase in IT exports can be attributed to the higher number of working days in May 2023 compared to April 2023. In addition, exports of non-IT services also showed growth, increasing by 18% in May 2023. However, IT export earnings decreased per weekday from $11.2 million in April 2023 to $10.7 million in May 2023.

On a year-over-year basis, IT exports rose 28% to $236 million in May 2023, primarily due to 95% year-on-year growth in telecommunications and 16% in computer services.

The year-on-year increase is partly due to a low base effect as IT exports stood at $184 million in May 2022. The increase was also due to interbank rates at Rs 298.93 on May 11, 2023. However, in the 11 months of FY2023, IT -exports $2.37 billion, showing a marginal decline of 1% year-on-year.

Published in EDP BLOGS on June 22, 2023.