Slowing economic growth
Everyone in govt appears to be concerned with getting through one year, hardly anyone gives any thought to next year.
Government appears to have only mastered the art of commenting about the economy, rather than making the tough decisions necessary to shape its future. PHOTO: FILE
For the second year in a row, Pakistan’s economic growth rate has slowed down and is projected to be a paltry 3.4 per cent during 2014, according to the Asian Development Bank (ADB). The headline numbers would be bad enough on their own were it not for what the ADB identifies as the root cause. Addressing the economic reforms pledged by the government, the ADB country director says: “Actual actions have either not been taken yet or have to show results. What Pakistan is going to achieve this year and next year is not enough to get this country out of poverty and put it on the path to development.”
We could not agree more and have been saying from the very beginning of this administration’s tenure — and throughout most of the last one’s as well — that the government appears to have only mastered the art of commenting about the economy, rather than making the tough decisions necessary to shape its future. His predecessor was not a raving success, but Finance Minister Ishaq Dar appears bent on setting new records. His obsession with the wrong metrics such as the currency exchange rate, his refusal to acknowledge the tax problem and his insistence on privatisation as the solution to everything are just some of the reasons why an economy with as much potential as ours is languishing with low growth and high inflation.
But it is not just the minister’s fault. All of Islamabad appears to be concerned only with getting through one year. Hardly anyone in government gives any thought to the next year, let alone a decade or two down the road. This adhoc approach to policymaking is why we make supremely irrational decisions like cutting investments in infrastructure to spend more money on subsidies and to bail out grossly inefficient state-owned companies. Meanwhile, millions of children go without access to schools and millions more of our citizens have no access to even primary healthcare. We spend more on electricity subsidies than on education and health combined.
Perhaps we should not be surprised that nobody in government seems to understand the linkages between these numbers. With such a low investment in education, perhaps nobody taught them the math.
Published in The Express Tribune, April 3rd, 2014.
We could not agree more and have been saying from the very beginning of this administration’s tenure — and throughout most of the last one’s as well — that the government appears to have only mastered the art of commenting about the economy, rather than making the tough decisions necessary to shape its future. His predecessor was not a raving success, but Finance Minister Ishaq Dar appears bent on setting new records. His obsession with the wrong metrics such as the currency exchange rate, his refusal to acknowledge the tax problem and his insistence on privatisation as the solution to everything are just some of the reasons why an economy with as much potential as ours is languishing with low growth and high inflation.
But it is not just the minister’s fault. All of Islamabad appears to be concerned only with getting through one year. Hardly anyone in government gives any thought to the next year, let alone a decade or two down the road. This adhoc approach to policymaking is why we make supremely irrational decisions like cutting investments in infrastructure to spend more money on subsidies and to bail out grossly inefficient state-owned companies. Meanwhile, millions of children go without access to schools and millions more of our citizens have no access to even primary healthcare. We spend more on electricity subsidies than on education and health combined.
Perhaps we should not be surprised that nobody in government seems to understand the linkages between these numbers. With such a low investment in education, perhaps nobody taught them the math.
Published in The Express Tribune, April 3rd, 2014.