24 November 2004	Wednesday	11 Shawwal 1425

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ISLAMABAD, Nov 23: The World Bank and the Asian Development Bank have asked the government to accelerate the implementation of its reform agenda which, they say, has not been effectively implemented so far due to "political pressures or changes in the government".

Sources said on Tuesday that the government had been told that many reform agreements, including the structural adjustment facilities of the International Monetary Fund, ran into difficulties and were either delayed considerably or not fully implemented.

The donor agencies maintain that with ongoing reforms and some improvements in investment rate economic growth might improve. They say the country's political and economic stability is dependent on geopolitical developments in the region, especially peaceful relations with neighbours like India and Afghanistan.

However, risk of opposition to reforms at political level was less in Punjab than other provinces because of a more stable political environment, they said. Both the donors expressed hope that the government would mitigate its macro-economic vulnerabilities by strengthening its economic performance considerably.

They recognize that the government had put in place a consistent economic strategy based on fiscal stabilization and debt reduction. They advised the government to improve the social sector's governance and objective decision making to "minimize rent seeking".

They said there was a risk that reform implementation might be delayed or undermined by the vested interests. They believed that devolution of the delivery system of the social sector to local governments presented a challenge as well as an opportunity.

While devolution moved social sector planning, implementation and monitoring closer to beneficiaries, it also introduced an additional element of commitment and capacity problems to deliver, they said.

They said the financial, managerial and technical capacity of local governments was limited and there would be limitations in effectively spending additional funds.

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