Towards the bottom in terms of income/well-being

The London-based Legatum Institute ranked Pakistan 107th (fourth lowest in performance) amongst countries according to income and well-being. The three countries that performed even worse than Pakistan were Ethiopia, Zimbabwe and the Central African Republic - countries that have been persistently in the news for poor governance, heavy reliance on agricultural output that is held hostage to weather conditions (leading to famine) and political unrest. Persistent failure to implement reforms accounts for these countries continuing to perform poorly on human development indices. What must shock Pakistanis is the fact that Somalia is ranked higher than us, a country which is currently facing a drought with the United Nations estimating around 750,000 potential deaths as the drought, defined as East Africa's worst for 60 years, worsens in the coming months. The report ranks Pakistan 85th for the public's ability to afford food and shelter (reflecting over 20 percent food inflation for the past three years), 105th for political stability (a clear indication that the policy of reconciliation that the PPP-led government insists is in the national interest is flawed), and 103rd for infant mortality (making a mockery of our claims that health care facilities are improving). Additionally, Pakistan is ranked at 86 for entrepreneurship and opportunity (indicating the large number of businesses that have and many that are in the process of relocating to other countries due to the continuing energy crisis, law and order issues and government borrowing from the commercial banking sector continuing to crowd out private sector borrowing). Pakistan was ranked 96 for the economy. This is disturbing as it coincides with a statement by Dr Hafeez Sheikh to the Financial Times in Washington that the government will not take the final 3.7 billion dollar tranche from the International Monetary Fund, subsequent to rejecting the Fund's strict reform demands. There are a number of concerns with respect to this statement, notable amongst which is the fact that the IMF tranche release had been pending since May 2010, because of the failure of the government to implement agreed conditions relating to power sector reforms as well as broad-basing the tax system. The Ministry of Finance requested an extension in the loan period hoping that it would succeed in generating political support to implement these critical reforms that would have begun to start paying off dividends by now. The IMF loan extension lapsed on the last day of September 2011 and it is significant to note that the programme support envisaged in Dr Sheikh's 2011-12 budget of 117 billion rupees is unlikely to be disbursed without IMF support for his 'home-grown reform programme.' Incidentally, during his entire tenure Dr Sheikh has not yet shared his home-grown reform programme either in parliament or with the media. Additionally, the report ranks Pakistan's performance as considerably worse than other countries on Gross Domestic Product per capita, on Transparency International's corruption index, on World Economic Forum's Global Competitiveness Index and the United Nations Development Programme's Human Development index. The report ranks Pakistan high in social capital measures undertaken by private individuals, with half of Pakistanis donating to charity and 24th in terms of people volunteering their time for an organisation. This highlights a well-acknowledged fact in this country: that the fault lines for continued economic deprivation and macroeconomic instability are attributed to the government's flawed economic policies (as well as parliament's), while the people of the country are striving to improve the lot of their not-so-fortunate brethren. Business Recorder has been highlighting the flaws in our economic policies and the resulting issues that are debilitating the economy. The government's cupboards are full of studies undertaken by international donor agencies that are gathering dust in our ministries. In short, the government is fully cognisant of what is required and what needs to be done but political considerations, as well as failure to pass an accountability bill during the last three and a half years have led to a status quo resulting in strengthening of the negative forces impacting on our economy. Copyright Business Recorder, 2011