WEF declares corruption impediment in economic growth
February 25, 2011
The World Economic Forum (WEF) has declared massive, blood sucking corruption as the biggest hurdle in business doing of Pakistan, due to which inflationary trend in Country was spiraling up at a skyrocketing pace.
In its recent report, in connection with GC index, taking economic account of 139 countries, has ranked Pakistan at 123; a rank that is fast hitting the turbulent airs of constant speedy downfall. The survey conducted in Pakistan by business executive was requested to identify 15 major constraints impeding the economic growth and well being of Pakistan. Majority, indicated massive, blood-sucking corruption as the major and foremost element, instability of an imprudent government as second, unstable and imprudent policies (that often backfire(d) with disastrous consequences) as third, inflation as fourth, eventually piling up with a highly inept and corrupt bureaucracy on fifth.
Crime and other dacoities on sixth, are followed by thorny financing opportunities on seventh, and tax revenue as eighth. Among a host of other hurdles, included are non-availability of a conducive infrastructure, lack of well trained, educated work force, slackening labor, foreign currency regulations, lack of health facilities, and labor regulations. WEF also declared that Pakistan was paying the highest cost of war against terrorism; whence it ranks 138 in a global listing of 139 countries; only Colombia surges ahead as the country torn apart and bleeding with ravages of terrorism.
Massive circulation of currency notes is fueling a skyrocketing inflationary trend, whence Pakistan stands at 137, out of 138 such countries; blocked only by Venezuela and Ethiopia. However one glittering factor redeems Pakistan’s tax revenue; at 31.6%, ranking 37. In most European countries this tax revenue stands at 40%. Pakistan with a massive six largest global population has a mere 0.63% GDP share. Corruption levels Pakistan at 117th in rankings, while it stands at 127 in organized crime: however regarding trust over politicians/leaders it ranks at 91.
The WEF reports reflects a horrifying picture, based on sheer reality, as the incumbents (still!) borrowed a hefty Rs.70 billion loan from State Bank, while they blissfully circulated 300 billion worth of new currency, blowing it all in their luxuries! If this situation remains constant, than by June 2011 the total loans from State Bank would pile upto Rs.800 billion, which would usher in tsunamis of inflation in Country.
A close comparison with brotherly friend, China reveals that its exports equaled the total of all Islamic countries alone! While Pakistan’s exports ranked at 68. Amongst 46 Islamic countries Pakistan ranked at 17th. India, meanwhile, ranks as 22nd biggest exporter, with 921.7% exports ahead of Pakistan. Meanwhile no Islamic country is represented in amongst 10 biggest global exporters.
This comprehensive survey report of Finance department of Pakistan has all and sundry worried, while investors and major businessmen are equally worried; as the government, with whom high hopes were pinned with utmost fervency, failed to deliver. This has prompted the business and monetary class of Pakistan to come forward with its own set of recommendations for the government. Pakistan Business Council (PBC) is a non-profit /non-political institution, formed by Pakistan’s core corporations, multi-national companies, and major business groups.
The PBC has stressed on government to finalize its economic agenda, by promoting multi-party consensus /dialogues. Encouraging the Parliamentary debates and consensus on National economic policies, which should/would be able to facilitate prompt and effective economic reforms. PBC has also encouraged / promotes political dialogue, and while floating some of its recommendations for basic National economic agenda, has stressed for restructuring of energy crisis on war footings. It has cautioned that strict measures would have to be taken for the purpose, which should be able to solve the thorny issue of inflation, sort out problems related to energy crisis, clear any hurdles in some major export issues, and encourage development/evolvement indigenous energy resources.
PBC has also urged on government to streamline / restructure its tax revenue, tariff strategy, by evolving a uniform tax structure in order to bring a positive change in deficit incurred in public finances. It has also recommended restructuring reforms in public institutions, including appointments of well-trained, educated and motivated cadre, in a transparent and impartial manner. It has also recommended curtailing of lavish, unwonted expenditures, and ridding of useless and ineffectual subsidies.
Public reforms advocated by PBS, include health, education, income support (including any possible / viable subsidies). It has argued that Pakistan was well gifted with numerous minerals and natural resources, and given a positive, and conducive economic environment and chances, it can very well strengthen its economy. Nearly all the business houses have shared the apprehensions, concerns and reservations of Pakistani masses, and have decided to unite under a common platform to surge ahead with economic reforms and agendas with an effective strategy.
Some of the biggest ever business concerns of Pakistan, which include Angro-Pakistan Packages, Pak-Arab fertilizers, Nishat Group, Duad Group, DESCON, Faysal Bank, Gul Ahmad Textile, and countless other major concerns. An agenda has also been finalized which focuses on restructuring of tax and tariff revenue fundamentals, uniform tax rate, no tax holidays, reforms in public institutions and departments, strengthening of such institutions as SECP (security and exchange commission of Pakistan), and CCP; besides terminating useless and additional ministries and institutions, among a host of many others.
According to president PBC, CEO of Angro-Pakistan feels that this is viable and practical agenda, since many aspects had been fully worked out. The major problem is political consensus, which required all political parties to sit together and arrive at a general consensus regarding economic reforms and agendas.