LAHORE: Pakistan’s economy can catch up with the prosperous countries of the West or East Asia only if it starts a national effort to stimulate growth.
“Business as usual is no longer an option. Each year an additional two million people enter the job market. By 2030, Pakistan’s population will touch 260 million and more than half of which will be in cities.”
This was the essence of a comprehensive report issued on Monday by the Institute for Policy Reforms. The report set forth a practical plan of action for achieving rapid economic growth.
Economic growth is a key for more jobs, better living standards, and poverty reduction. Increase in economic gap with other countries could affect Pakistan’s regional position.
The report details how high growth economies transformed their nations through favorable policies. In 1960, South Korea had a GDP per capita three times of Pakistan. Now its per capita income is 22 times more.
It says Pakistan’s policies do not support economic growth and the country must institute wide scale reforms. The report also offers a plan for reforms citing examples of other countries.
The report suggests that Pakistan must increase government revenue to enable it to provide public goods and to reduce external borrowing.
It says public investment must focus on high priority projects in the areas of power supply, transmission/distribution, and water storage and efficiency.
It must also strengthen agriculture research and extension services. It believes that an export-oriented trade policy would stabilize the external account.
The report further states that public and private players must cooperate to boost economic activity. All incentives must be dispensed without patronage and the government must have a dedicated team of policy makers and experts to provide help in decision making.
It asks the government to review power policy to improve energy mix and the generous incentives to investors. It says the government must cooperate with industry for skills development.
Published in Dawn, March 28th, 2017