ISLAMABAD, Oct 4 (APP): Citing the gradual acceleration in economic activity, the World Bank (WB) has predicted the GDP growth rate in Pakistan to accelerate to 5 percent at factor cost in 2017 and 5.4 percent in 2018.

“The economic activity is projected to gradually accelerate over the medium term reaching 5.0 percent in 2017 and 5.4 percent in 2018, building upon 4.7 percent, GDP growth at factor cost in 2016 (5.7 percent at market prices)” according to WB’s twice-a-year South Asia Economic Focus.

The report says, the economic growth is primarily driven by public and private consumption, however some re-balancing in growth components is expected due to a rise in investment.

This will primarily be driven by infrastructure projects under the China Pakistan Economic Corridor (CPEC) and related public investments.

These projects should help accelerating growth in the domestic construction industry and increase electricity generation.

Sustainable and inclusive growth and poverty reduction, however, will require greater private sector investment and the development of infrastructure in the medium term, as well as a continued focus on fiscal consolidation and structural reforms, the report added.

South Asia has defied a sluggish world economy and solidified its lead as the fastest growing region in the world in 2016, World Bank report said.

According to the twice-a-year, South Asia Economic Focus, the region remains a global growth hotspot and has proven resilient to external headwinds.