http://www.dawn.com/2008/05/27/top10.htm

Pakistan needs 159 years to catch up with industrialised world


By Anwar Iqbal

WASHINGTON, May 26: Pakistan needs 159 years to catch up with industrialised nations, says a report by the Commission on Growth and Development, an independent body based at the World Bank headquarters in Washington.

The commission’s growth report, however, notes that Pakistan can reach this milestone by 2050 if it maintains an annual growth rate of 8.3 per cent and in 2100 if it maintains a growth rate of 4.9 per cent.

Pakistan has maintained the maximum growth rate of 4.8 during the last 10 years with an average of 1.8 per year.

Pakistan’s per capita GDP in 2006 was $2,206.

The report notes that China, which in 2006 had per capita GDP of $6,621, can catch up with industrialised countries in 23 years.

During the last 10 years, China has had an average growth rate of 8.3 per cent, with a maximum of 10.1 per cent.

India, with per capita GDP of $3,308, can catch up with industrialised nations in 50 years. During the last 10 years, India had the maximum growth rate of 7.7 per cent, with an average of 4.9 per cent.

Among the Muslim nations, Malaysia is the closest to catch up with industrialised nations. It can reach this milestone in 35 years, followed by Iran, which can reach there in 54 years. Egypt needs 118 years.

The report notes that in 1960, some of the largest developing countries have put their economies on track to catch up with industrialised countries; many others have not. There are about 150 developing countries in the world. The 10 largest among them account for about 70 per cent of developing countries’ GDP, and the 25 largest countries for about 90 per cent.

The growth performance of these 25 countries has been uneven. Because industrialised countries’ growth rate is about 2 per cent per capita, developing countries need to grow at much higher rates to catch up. Less than half have been able to reach this performance.

Since 1960, only 6 countries have grown faster than 3 per cent in per capita terms and 10 had growth rates below 2 per cent, implying that they have fallen farther behind industrialised countries’ incomes.Pakistan’s real GDP in 2006 was 99 billion in constant 2,000 dollars.

Pakistan’s share in total developing countries’ real GDP in 2006 was 1.2 per cent. Pakistan’s growth rate between 1980 and 2006 in real GDP was 5.1 per cent and in per capita it was 2.5 per cent. Between 1960 and 2006, the real GDP growth rate was 5.5 per cent and in per capita it was 2.7 per cent. The real GDP growth rate in 1960 was 9 per cent.

In 1960, Pakistan ranked 20th among the developing nations.

Differences in economic performance imply that for many developing countries, per capita incomes are lower than they were a few decades ago.

Because of the consistently improving economic performance of China and India, the share of developing countries in global GDP is increasing. The corollary is that the share of the United States, Canada, Japan, and the European Union has been declining since the 1980s — although these economic blocks together still account for 70 per cent of the world’s GDP.

And our moronic leaders such as Musharaf and all these idiot politicians just can't shut their mouths and lie on economic progress!!

Malaysia needs to double GDP and they will be in EU average. They can do that in less than 10 years with growth of 8.5%.

If status quo exists then I agree. But with change we are not far behind. I would say around 10 - 20 years if there was national momentum.

I also agree with the report...on the plus side that gives us 159 years of very hard nation building to do, akin to the European powers during the post-Renaissance era.

If we start working and impliment the econmics, then i say 159 months are enought to progress!! On the condition if we kick out morons who are acting as our leaders!!

159 months !

Even 100+ years is optimistic. The institutions havent even matured ,what to talk of laying down foundation of a prosperous state. I am not even talking about making facilities available to masses like in West. Even basic democratic institutions have a long road ahead of them. The two most powerful men in Pakistan have intermediate education. The voting majority is educated in terms of writing their names only.

It would be an ideal situation if PhD in Chemical Sciences/ IT becomes PM of pakistan. And MA would be made compulsary for every candidate of NA and Provincial Parliment!
Atleast literacy will be become more effective!!

What about revolution?

Other than that I don't see any hope

What a damn shame ... we only have ourselves to blame .

Thats indeed a shame thing that the literate society avioids the politics for their secuirty. Now who is responsible for this fear??

Government isnt it. When government relaxes the liberties to politicians then they start to work for their own interest n when this happens corruption takes place. n then the whole scene of Pakistani Politics start!

This video captures my sentiments ::

http://www.youtube.com/watch?v=s3D5XumULlg

As the article states, it can be done by 2050 if we mantain good economic growth, and even sooner if we mantain massive economic growth (10+% per annum). All we need is a stable and corruption free government headed by a progressive and business savy leader. Even the problems with militants and so on can be dealt with swift economic and social growth. Educate the masses, bring the literacy level to at least 90+%, have 100% enrollment. A good way to do this would be to increase the efficiency of each farmer (by increasing the yield per acre in the country and the amount of acres each farmer can farm). This way, each farmer would be producing more farm products and thus more profits and as a result the children would not be needed to help in the farming, and they then can go to school.

I could write a 10 page article on how we can improve the country, through relatively little effort and relatively little money of our own (the government's I mean). A stable government/country along with top notch infrastructure will insure massive amounts of FDI, FDI in turn will result in more revenues for the country resulting in more social and economic growth, and thus creating a cycle of development which is needed to improve the country.

If that article is comparing today's Pakistan to today's West, then we don't have much to worry about. In relative terms, Western Europe was very strong & rich from at least the 19th century, if not earlier. I think by 2050 Pakistan could be the right wing equivalent of communist China...we just need a Chairman Mao to slam a serious danda to get our awam in order...smooth sailing from there I think.

Oh what a way to put it .
I think by 2050 Pakistan could be the right wing equivalent of communist China...we just need a Chairman Mao to slam a serious danda to get our awam in order...smooth sailing from there I think.

Without killing some unwanted millions and DANDA this nation will never become a power to reckon with.

Depends if the worst feudal lords, criminal gangs, political storm troopers/party thugs, etc make up "millions"...

It is a blood-y shame indeed! However, I would like to reiterate my strong condemnation of Musharaf and the military for wasting more than 8 years of precious time—time in which he could have made fundamental changes to the system of government in Pakistan because when he came to power he had support of so many ordinary people. Instead this man decided to make US happy and to play dirty by getting in bed with some of the worst politicians.

Not only that this man is guilty of handing power back to scum bags of the worst kind but In my eyes he is also a scum bag for making lives of 160 million people miserable, and for missing a historic opportunity to put this country on a fast track to economic progress!

this report has some factual errors in the last 10 years pakistan's max growth has been 8.4 % in 2005-06 and we've averaged around 6-7% not 1.8% as this moron is suggesting, \


our real income per cap is already more than 1000 dlrs , perhaps even higher than india.

if we maintain a 7-8% growth rate we would be at par with the S.E.A tigers in less than 15 years

10 if all politicians are shot with shot gun placed a foot away from there nose.

P.s. use two shot guns and place them closer to avoid any misfire and just to make sure that there brain splatters on the wall.

Thank you.

I think that the writer is probably correct, he is comparing the growth in the past 10 years i.e 1998-2008. We had so many sanctions, IT bubble burst , military coup and what not, but 1.8% is really an understatement it should be around 3-4%



I agree on that...




Not true, if you assume that Pakistan grows at 8% p.a. then India also grows at same rate (assuming otherwise will be living in self denial) and even if you compound the growth rate, we will always trend behind them all the time; unless we nuke them

Their per capita is based on PPP, when most of the world bases it on actual GDP. Per capita off of GDP would put Pakistan at slightly over $1000 making it a middle income country. For comparison, India's per capita (off of GDP) is slightly less than $1000. As the article states it would take 8.3% growth per annum until the year 2050 to catch up to industrialized countries. Now look at China which is having 10+% growth per annum. There is no reason whatsoever that we cannot achieve the same thing; all that needs to be done is an elimination of corruption, a good business environment, a good leader along with a stable government/country (easier said than done of course). But with 10+% growth per annum we could catch up by 2040 or so.

Yes we can do it but you are assuming that our politicians and our military dictators will all of a sudden become intelligent and start thinking about ordinary people. I don't see this happening with the current system of government. This system will keep bringing back dictators, scum bag politicians, corrupt landlords like Zardari, A-holes like Nawaz.

If God does a miracle and some leader with courage and intelligence comes in and changes this corrupt system, a leader that can also give a big bamboo to the out of control military then we can achieve this result in 50 to 60 years!!

Well, if Pakistan would be unfortunate to keep getting thugs like Nawaz, BeNazir and Zardari ruling the country and finance minister like blatant liar Ishaque Daar than Pakistan would be lucky to have per capita more than present day Sudan after 169 years. But if Pakistan would be lucky to have strong and committed person as leader like Musharraf and finance minister like Shaukat Aziz than most likely Pakistan would reach European standard per capita income within next 40 to 50 years.

This is how per capita income of Pakistan changed in dollars during various periods:

http://www.statpak.gov.pk/depts/fbs/statis...l_accounts.html

Pakistan per capita economy in 1958 was $ 80
Pakistan per capita economy in 1969 was $ 152
Ayub period (11 years): per capita increased @ 6.00 percent per year.

Pakistan per capita economy in 1972 was $ 184
Pakistan per capita economy in 1977 was $ 213
Bhutto period (5 years): per capita increased @ 2.97 percent per year.

Pakistan per capita economy in 1977 was $ 213
Pakistan per capita economy in 1988 was $ 395
Zia period (11 years): per capita increased @ 5.77 percent per year.

Pakistan per capita economy in 1988 was $ 395
Pakistan per capita economy in 1999 was $ 468
Thugs NS and BB period (11 years): per capita increased @ 1.55 percent per year.

Pakistan per capita economy in 1999 was $ 468
Pakistan per capita economy in 2007 was $ 925
Musharraf period (8 years): per capita increased @ 8.89 percent per year.

Well, since thugs left the economy shattered, growth during earlier years was slow as economy was stabilising. Here how it went:

Pakistan per capita economy in 2002 was $ 509
Pakistan per capita economy in 2007 was $ 925
Musharraf period (5 years): per capita increased @ 12.69 percent per year.

This momentum kept going and today per capita has passed $1000 figure.

No, I'm assuming they die... somehow...

the key is non interference of gov in economy i.e. free market economy, in that way then the market dictates the economy not the gov, the politicians can go screw themselves...

p.s pakistan's current economic woes are only due to current acc deficit which is because we had budgeted for oil to be arnd 60 dlrs a barrel but we are buying it at twice that price, so our imports have gone up like crazy, and we need foreign exchange to pay for that so our foreign reserves have gone down for the time being. besides that in the short time this gov has been in charge, they cudnt have dont too much damage or too much good for that matter.

since our imports are so high, the demand for foreign currency is high and the rupee is low so our currency is getting devaluated, and that's causing inflation too.

to get our economic fundamentals right in the short term we need a tight monetary policy which would mean increasing intrests/discount rates that the SBP has already done...less money in market, ppl get tight. ... oil is something we can't control and food prices we can heavily subsidize for local populace, since we technically do meet most of our food needs.

Well, what a simple explanation

I do not think that rupee devaluation is due to oil imports. My guess is that, rupee devaluation has happened because lot of rupees were converted to dollars and left Pakistan just after NRO. Where that money came from ... well, it was illegally obtained money that was stuck in Pakistan. Rough estimate is that, around 25 to 30 billion dollars of mostly corrupt money that got unstuck after NRO left Pakistan, especially in last 2 months. Unstuck because they were though unknown to government but was there in hiding and once NRO gave pardon to corrupts, all money started coming out of hiding and moving out of Pakistan. I do not think that even Musharraf and government had idea that this much of corrupt money could have been hiding in Pakistan, waiting to fly out.

I believe that Nawaz, Zardari and their crook thugs, all have transferred their ill-gotten billions from Pakistan during last 2 to 3 months, but probably this transfer of wealth started after November last year (Nov 2007). Slowly before election and in big way after election.

You can't use the data you have the way you did. You'll have to account for inflation and convert all the $ figures to a reference year to make them comparable. $88 in 1950 had a lot more purchasing power than what it'll buy in today's world.

For instance as per the title link of this thread Pakistan’s per capita income grew by avg 1.8% in last decade or decade of musharraf which is lower than 2% per capita growth in developed world. The reason for that is that inflation has stayed pretty close to economic growth rate, add population growth to it and you have one of the worst per capita income growth periods in your history under Mushy i.e. 1.8%. Or in other words the gap between developed world and Pakistan has widened in Mushy decade.

It is harder for a country to control or even predict international inflation, it is easier (in comparison) to control the country's growth (in terms of GDP). Inflation has accelerated rapidly in the past few years, resulting in the problems we see now. In relative terms, the per capita income has grown far more under Mush as compared to the other regimes in Pakistan's history.

Well, I was not quoting what real per capita increase happened during different periods but was trying to show the increase in dollar per capita of Pakistan during different periods. Still, that does not mean that I do not know real increase in per capita income during different periods that you can fool me, like most of Nawaz team try to do to ignorant Pakistanis.

I think that you know nothing about economy neither you have any knowledge about real growth rate. If you knew than you would not have wrote what you did, as real per capita growth rate for Pakistan during Musharraf period is highest in Pakistan history (not just in dollars, but even in real growth). On the other hand, Pakistan real per capita increase during Thug periods (1988-1999) was lowest in Pakistan history. I hope that you know the meaning of real per capita income growth. It means per capita income growth after adjusting for inflation.

For instance, if per capita increased from 100 to 120 (20 percent) and if inflation is 10 percent than real growth would be 9.09 percent [ that you can get it from [(120 divided by 110) minus 1 than multiply by 100].

You are right that the article talks about real per capita increases and says that during last 10 years, Pakistan real per capita income increased by 1.8 percent, but have you got the idea why?

Now coming to the mentioned article of this thread: 10 years that article refers to is from July ‘96 to June ‘06 (if you will read the actual report than you would know) and figures is low because real per capita actually decreased during those first 3 years (1996-1999) when Ganja crook Nawaz was ruling the country (apart of few earlier months as Nawaz came to power in Feb ‘97). Further, growth during earlier two years of Musharraf period was also low growth period as Shaukat Aziz used that period to consolidate the economy, still after such low first 5 years growth durining 1996-2006 (growth during these first 5 years were either negative or almost zero), still Pakistan managed 1.8 percent growth because Musharraf later period had very high growth rate.

Ref: http://www.statpak.gov.pk/depts/fbs/statis...unts/table3.pdf

For instance let see real per capita increase between 1996 to 1999 (period of Thug Nawaz Shareef rule):
1996: Rs 5016
1999: Rs 4992
Or real per capita income decreased (yes, it decreased) by Rs 24 over Rs 5016 in those unfortunate 3 years. That is real per capita income actually decreased by 0.5 percent in 3 years of Ganja Nawaz. Or real per capita decreased on average by 0.17 percent per year during 1996 to 1999 (or it was negative growth in real per capita income for Pakistan). This is nothing to do with nuclear test as nuclear test happened at the end of May 1998 and Kargil in early 1999, and if there could have been any effect because of that, than it would have been during Musharraf earlier period, but crook Nawaz economical period was bad throughout because he had no time for the country other than confrontations with institutions and looting the country.

Let show you what happened to real per capita growth in Pakistan during Thugs periods:
1988: Rs 4433 (start of Thugs period)
1999: Rs 4992 (end of Thugs period)
Or real per capita income increased by Rs 559 over Rs 4433 in 11 years.
That is real per capita increase of 12.61 percent in 11 years.
Or on average, increase in real per capita was 1.085 percent per year from 1988 to 1999.

Now compare what happed once Musharraf took over: I am starting Musharraf period from 2000 to 2007: I excluded 1999-2000 because base rate change happened in year 2000 and if I will use start year as 1999 than due to rebasing I will have to readjust 1999 figures and if I would do that then some who do not understand anything about economical figures might say that I fiddled the figure (if not you, still most Nawaz thugs would do that). So, to exclude any doubt (barring ignorant thugs), I am using figure from 2000 as start period and would work the increase from there. Using start figure from 2000 to calculate percentage increases means that any effect of rebasing is excluded from figures quoted in percentage (so, please no BS about rebasing ).

2000: Rs 27471 (start year)
2007: Rs 33678 (end year)
Or real per capita income increased by Rs 6207 over Rs 27471 in 7 years.
That is real per capita increase of 22.6 percent in 7 years.
Or average increase in real per capita was 2.95 percent per year during those 7 years from 2000 to 2007. So, you can see that real per capita started increasing at much faster rate than Thug periods.

Well, actually the story does not end there. Reality is that, earlier period of Musharraf was used for restructuring the economy and thus per capita did not increase much during first 2 to 3 years. So, if we use starting year as 2002 (year of election) then:

2002: Rs 28291 (start year)
2007: Rs 33678 (end year)
Or real per capita income increased by Rs 5387 over Rs 28291 in 5 years. That is real per capita increase of 19.04 percent in 5 years.
Or average increase in real per capita was 3.55 percent per year during those 5 years between 2002 to 2007.

That is not enough as Pakistan economy kept getting stronger year after year and this is result of last two years:

2005-2006: Pakistan real per capita income increased @ 4.45 percent (from Rs 30695 to Rs 32060).
2006-2007: Pakistan real per capita income increased @ 5.05 percent (from Rs 32060 to Rs 33678).

So, you can see that from negative per capita growth during Nawaz last period (and very low growth of Thugs 11 year period), Musharraf government turned the economy and real per capita income started increasing at healthy rate such that at present the rate Pakistan started achieving is real growth in per capita of 5 percent per year. It is handsome increase but for how long? I do not know, as corrupt thugs have come back again

I agree with Usman ali...

South Asians generally speaking both indian & pakistani are uneducated.. Their children therefore remain uneducated.

They have no concept of democracy or improving living standards.

Corrupt leaders and military dictatorship give them no chance at all..

Today Pakistan is not far from real economic crisis.

The fact is that us Pakistanis have no one else to blamebut ourselves. We let these ba$tards take and hold power. If we, as a nation, really had courage and determination like our forefathers did back in the 40s we wouldn't stand for it...

Like some others have said, the Pakistani economy is no where near gone yet but unless action is taken soon we'll be in for a long painful recession.

These bastar-ds were bought in by another bastar-s called Musharaf who was fully backed by the military. These thugs are here to destroy the country and to loot it, and are playing with the destiny of 160 million people!!

stop blaming leaders, they are a product of the system
the system is broke

first thing that any nation does is gain stability and the power in the hands of the central governent (american civil war, civil war of england, prussia taking over all of germany, formation of the soviet union, communist revolution in china, and more recently the communist vietnamese)

not for the ideology, but for stability a central government, that is generally fair and just, will bring business (exclude oil rich nations where the golden rule applies)
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from this what defines us, who are we, what does our nation stand for, something most of us can agree on
democracy, dictatorship, far right, far left, whatever, we need a focus
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from there coruption can be minimized and then social ills can be eliminated
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but also we are in the middle of a muslim world wide struggle, which will tie us down, like the wars of europe tied down europe in the renaissance

once they became unified nations, that resolved all but the major wars, could they then industerilize (modern example is internal chinese wars; tibet, nationilist on mainland are resolved) but the taiwan asian-pacific wars are still there, which drive the to industrialize to say they are as good as the other nations

the sort of strategic location we have...if we are left unhindered, we can rise to them very quickly
the strategic location has caused us more troubles than good so far


and by the way if we need 159 years to catch up with them...how many bad months do they need to come down to us?

have your figures properly accounted for the loss of east pakistan in 1971?

What a sensationalist bullshi1t title. 159 years... at what rate of growth?

4.9% would mean we could catch up on 92 years, and in 42 years at 8.3%.

Over the last few years we have growth rate of nearly 7%.

If we can get back on track we can be first world in 40-50 years. your grandchildren could be born into a pakistan to be proud of.

7% real economic growth rate not the per capita income growth rate.

VIEW: Another 159 years? — Syed Mohammad Ali

Will Pakistan be able to secure development faster with the mentioned World Bank reform agenda, or will the Commission add another few decades to the estimated time period by when Pakistan can hope be a developed country?

The development sector has grown exponentially over the past few decades in terms of importance, resource allocation, and the number of multilateral, governmental, and civil society organisations involved in it. It thus makes good sense to begin gathering information about the most effective means to promote sustained economic growth and poverty reduction, so as to devise prescriptions for existing policymakers.

However, extracting workable recommendations based on analysis of on-ground realities is not as easy as it sounds, and even the most credible attempts in this regard can sometimes produce surprising results, as this article will soon indicate.

Two years ago, the World Bank launched its Commission for Growth and Development to fulfil this exact role of providing sound development advice based on emerging experiences from around the world.

The Commission is supported by the governments of Australia, Sweden, the Netherlands, and the UK, in addition to being backed by the World Bank itself. Michael Spence, a Nobel Laureate and former Dean of the Stanford Graduate Business School, heads the Commission. Several other relevant governmental, business and policymaking personnel, especially from the developing world, are also involved in the research and analysis that is undertaken by the Commission. The repute of the professionals working for it, and the sound institutional backing enjoyed by the Commission, lends its findings a certain air of authority.

Among other work, the Commission has estimated time-periods required by different countries to achieve the status of being ‘developed’. What is surprising to note in this estimation, for people in our part of the world at least, is the amount of time Pakistan is said to require in order to be at the same level of development as today’s industrialised nations: 159 years! At best, Pakistan may reach this milestone by 2050 if it can maintain an annual growth rate of 8.3 percent.

However, growth rates in Pakistan do admittedly remain unstable. The average national growth rate plummeted to less than 4 percent per annum in the 1990s, compared to the earlier decade’s rates of more than 6 per cent per annum. The fairly high growth rates during the earlier years of the current decade also seem quite unsustainable at the moment. The Commission calculated that Pakistan had maintained a growth rate of 4.8 percent from 1996 until 2006, which is why the country was said to require another century and a half to become developed.

China, which in 2006 not only had impressive growth rates, but a per capita GDP of over well over $6,500, was estimated to be at par with industrialised countries in about two dozen years. India still needs about fifty years to catch up with China and other developed countries. On the other hand, Malaysia seems to be doing well despite the East Asian financial crisis of the past decade, since it is thought to need only 35 years to achieve the milestone of becoming developed.

In support of its assessment, the Commission points out that out of about 150 developing countries in the world, 25 of the largest countries account for about 90 percent of the GDP of the entire developing world. However, the performance of these 25 countries has been uneven over the past five decades, and less then half of them have been able to perform well enough to have improved circumstances for their citizens, instead of further worsening them. In fact per capita incomes in many developing countries are lower today than they were a few decades ago. In 1960, for example, Pakistan was ranked 20th among the developing nations, whereas now its human development indicators have pushed it down to a much lower position.

Any such projection of development trends is bound to provoke criticism, particularly from countries whose future prospects have not been assessed too positively. Avoiding the urge to become defensive however, let us try to neutrally assess the Commission’s estimation concerning Pakistan.

First of all, while the Commission has focused on indicators like cumulative incomes and productive capacity of nations, assuming that poverty cannot be reduced in isolation of economic growth, it is hard to deny that there are also various other economic and social forces underlying rapid and sustained growth, which seem much less understood or accounted for.

Factors like the political climate which determines development aid flows, or environmental factors which may seriously impede the process of development, or else the introduction of new technologies which may place countries on much faster trajectories of growth, have not been factored in adequately into the Commission’s estimation.

The Commission does however stress upon steps which can be taken now to boost economic growth even in countries which have not been listed amongst rapidly growing economies. Moreover, the Commission shows some sobriety in this regard by recognising that fast and sustained growth requires more then short-term quick-fix efforts, but instead long term diversification of the economy which enables a smooth and mutually beneficial integration into the larger global economy.

Yet problems facing countries with slower rates of growth are not easy to overcome. Consider the challenges being faced by Pakistan at the moment for example. After several years of over-enthusiastic growth projections and poverty reduction estimates, there are now acknowledged concerns of a mounting fiscal deficit and a falling currency, which imply many other problems. The current threat posed by rising food prices calls for prompt action to protect poorer people from price increases, or else malnutrition and reduced incomes could seriously reduce long-term growth prospects.

The new Prime Minister of Pakistan has been discussing a $500m loan from the World Bank to help achieve the newly laid-down priorities of overcoming energy, water and food shortages through construction of new dams and other related projects.

But the World Bank implies taking potentially unpopular steps, including ending subsidies on oil imports and cutting development expenditure. One wonders what impact these steps will have in the estimation of the Commission.

Will Pakistan be able to secure development faster with the mentioned World Bank reform agenda, or will the Commission add another few decades to the estimated time period by when Pakistan can hope be a developed country?