Resource information
Pakistan's rebound from the global
financial crisis has been slow and fragile, and unless the
economy changes course swiftly, it could face its second
balance of payments crisis in five years. Its recovery from
the 2008-09 global financial crisis has been the weakest in
South Asia, with a double dip pattern. This report
identifies conditions for a sustainable job-enhancing growth
agenda for Pakistan. Policy must target both goals as they
are closely intertwined. Higher growth rates can be achieved
through productivity improvements (technology, innovation,
better economic governance), but also from higher output
extracted from factors-physical capital, labor, human
capital, and land. This report considers whether Pakistan
should pursue historical growth of 4.3 percent a year,
supported by piecemeal structural reforms leading to partial
and unsatisfactory outcomes-or rapid growth of 7 percent,
requiring comprehensive big-bang reforms. The report is
organized around three major themes: (i) the stylized facts,
what are the pluses and minuses of Pakistan's patterns
of growth and job creation? (ii) the diagnostics, what is
holding back Pakistan's growth? And (iii) the
transformational agenda, what are the core ingredients of
job-enhancing growth? And how can analysis of the political
economy identify policy tradeoffs?
