DAVOS, Jan 30: Prime Minister Syed Yousuf Raza Gilani said on Friday that his government was facing serious economic and security challenges, but was determined to turn these into opportunities through good governance and transparency.

Speaking at a breakfast meeting on the sidelines of the World Economic Forum, the prime minister said that like other countries Pakistan was facing an economic crunch, but was handling it with prudent policies.He said the government was strictly adhering to a policy of transparency as the new democratic government believed that proper accountability could ensure good governance.

He rejected a perception that Pakistan was a ‘failed state’ and said all the institutions were functioning properly.

Mr Gilani said Pakistan was successfully isolating tribesmen in the frontier region from militants and extremists.

He also said that military action alone was not a solution to the situation in the tribal areas.

He described terrorism as a regional problem and said Pakistan had paid a heavy price in its efforts to make the world a safer place to live in. Pakistan, he added, had lost many times more law-enforcement personnel than Nato.

“We have the will to fight, but the world needs to build the capacity, particularly of Pakistani police and Frontier Constabulary.”

About ties with the new US administration, Mr Gilani said his democratic government was in close contact with the Obama administration because both shared the desire to eradicate extremism and terrorism.

Mr Gilani said that Pakistan’s strategic location could make it a global economic hub, providing access to the landlocked Central Asian Republics, Middle East and rest of the world.

About the Economic Forum that attracted government and business leaders from across the world, the prime minister called for measures for the economic uplift of developing countries.

He stressed the need for developing a coherent global and institutional policy. He cautioned against trade protectionism or denial of market access to countries like Pakistan.—APP