Trella concludes operations in Pakistan.
OICCI notes that many of its members are considering closing up or scaling its operations.
KARACHI: According to global news agency Bloomberg, Egyptian trucking startup Trella has chosen to stop operations in Pakistan. The choice was made at a time when Pakistan is going through one of its worst economic crises and a number of other businesses have already closed or suspended operations there.
In 2021, investors including the investment arm of AP Moller-Maersk A/S contributed $42 million to the financing of the logistics startup, which links shippers and carriers.
In the recent past, companies including Vitol-backed VavaCars left Pakistan, Swvl Holdings in Dubai halted daily trips, Uber’s Careem halted food delivery, and Airlift, which raised an all-time high of $85 million, failed.
The Overseas Investors Chamber of Commerce and Industry (OICCI) said that due to restrictions on the repatriation of earnings and dividends as well as a ban on the import of raw materials by manufacturers, half of its polled members are considering closing down or downsizing operations in Pakistan.
The government has implemented these steps in order to manage its severely depleted foreign exchange reserves and a high danger of failing to repay its foreign debt.
Pakistan’s credit rating has been lowered to the category of “elevated risk of default” by Moody’s Investors Service and Fitch Ratings, respectively. Since January 2023, Pakistan and the International Monetary Fund (IMF) have been in negotiations to restart the $6.5 billion loan programme that has been on hold since November 2022.
According to Jameel Ahmed, governor of the State Bank of Pakistan, after the IMF programme is launched, foreign exchange reserves will top $10 billion. However, due to a significant devaluation of the rupee, escalating inflation, and historically high interest rates on bank loans, experts warn that Pakistan is exhibiting signs of default.
