Asia Regional Integration Center

Economic growth inched up to 2.5% in 2017 as security and political challenges continued to weigh heavily on the economy. Agriculture, industry and services all grew. Inflation peaked at 7.7% y-o-y in May 2017, but dropped to 3.1% in December. The current account surplus including net transfers narrowed to 4.5% of GDP. Gross international reserves rose to $8.2 billion, providing cover for 13 months of imports. Good progress on domestic revenue collection was insufficient to counter declining grants. Economic growth, job creation, and reducing dependence on donor support will depend heavily on attracting private investment.