As if doom and gloom despite the blissful occasion of Eid wasn prevalent enough, Pakistans latest rankings for 2010-11 by the Global Competitiveness Index (GCI) come as another depressing indicator.
Falling down 22 places from the previous year to 123 out of 139 countries, Pakistans rankings weakened across most of the areas, with a particularly poor showdown in the basic requirements index, including institutions, infrastructure, health and primary education, and the worst performer, the macroeconomic indicators.
However, the efficiency enhancer indicator, which reflects the potential for an economy to become efficiency-driven, did not post a picture as dismal, falling down only three places from the previous year at 95 out of 139 economies.
A comprehensive analysis of the efficiency index indicates that Pakistans market size is a huge plus factor for the country with a population of 180 million people. This mammoth number presents tremendous potential and scope for market development and expansion.
Similarly, the Financial Market Development index is also a key factor helping Pakistan perform better in the efficiency index with a ranking of 73 out of 139 countries, a better ranking than countries like Greece, Ireland and Italy.
Even though a varied range of financial services are not available in the emerging financial sector of the country, the affordability of financial services, ease of access to loans, a strong local equity market and the stringent regulations of the SECP have helped the country sustain a stable financial market.
However, the efficiency of Pakistans labour market stands at odds with a low labour-employer cooperation, high rigidity of employment and a very low female participation ratio. Consequently, talent utilization in the country remains quite inefficient.
Poor standards of higher education and training are another quandary that reduces the potential for the country to enhance its efficiency. Low rates of tertiary enrollment and minimal on-the-job training aggravate efficacy and efficiency of the local economy.
Lack of adequate technological readiness and acceptability of latest technologies also put Pakistan at a disadvantage as far as improving efficiency is concerned. Poor access to the internet has prevented the country from harnessing the global availability of information, knowledge, ideas and awareness about the new commercial opportunities.
"ICT (information and communication technology) has not been used to encourage entrepreneurship and the surges in self-employment evident in competitors. The public sector has not taken advantage of e-government to improve its efficiency and service delivery," said a 2010 Competitiveness Support Fund (CSF) report on growth and competitiveness in Pakistan.
However, attempts in the right direction can help render the Pakistani economy more efficient.
Right now, the GCI index ranks Pakistan in the first stage of factor-driven development. Integrated efforts at improving higher education, training and labour productivity, and expanding the scope of ICT in business, governmental and educational affairs can help the country transition to the second stage of development - that of an efficiency-driven economy.
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Pakistans ranking in Global Competitiveness Index
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Rank Score
(out of 139) (1-7)
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GCI 2010-11 123 3.5
Efficiency enhancers 95 3.7
Higher education and training 123 2.9
Goods market efficiency 91 3.9
Labour market efficiency 131 3.5
Financial market development 73 4.1
Technological readiness 109 2.9
Market size 31 4.6
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Source: WEF, Global Competitiveness Report 2010-11