Economic and social development should not be left to economists and specialists only.
This message is manifested in “Window of Opportunity,” a video highlighting the ambitions and goals of the World Bank’s 2015-19 Country Partnership Strategy in Pakistan.
Truck drivers, entrepreneurs, doctors, teachers and thousands of other citizens from Pakistan shared their ideas and helped identify opportunities and challenges to guide future policies and action areas.
These individuals come from a myriad different backgrounds but are united by a common drive to open up windows of opportunities for Pakistan.
As Pakistan readies to celebrate its independence day, we can all feel satisfied about progress in restoring macroeconomic stability, but should also realise that the country can and should do much better. Pakistan has many assets, of which it can make better use — from its vast water and river endowment, to its coastline and cities, to its natural resources. And there are upsides: a growing middle class, a lively informal economy and a strong influx of remittances. Pakistan can also be proud of the first peaceful transfer of power between two civilian governments. But to reach its full potential, Pakistan needs to focus on two critical areas, both obvious and urgent. It needs to ensure that its people have the means to fully participate in and contribute to the economy. And it needs to integrate itself more, globally and regionally.
The first challenge is demographic. As a result of rapid population growth, 1.5 million youngsters reach the working age each year. The question is, will the private sector be able to provide the jobs they need and want? And will the youth have the skills to get good jobs? Pakistan must do far better in education. Primary school net enrollment is about 57 per cent, well below other South Asian countries. Enrollment drops by half in middle school, with much lower levels for girls and children from poor families. This is not a good foundation to build on.
It is not surprising then that Pakistan also struggles to give all its citizens the opportunity to participate in building better lives for themselves. Only 25 per cent of women participate in the labour force, compared to 50 and 80 per cent in most developing countries. Women and girls deserve better. Research shows that girls with little or no education are far more likely to be married as children, suffer domestic violence, and live in poverty. This harms not only them, but also their children, their communities and the economy. Greater gender equality can enhance productivity and improve development outcomes for the next generation. It is smart economics.
Pakistan has taken steps to empower women. The Benazir Income Support Program, supported by the World Bank, has provided millions of women with national ID cards and makes direct payments to them, strengthening their ability to take decisions and move out of poverty.
It has been exactly three months since the Nepal earthquake first struck and one month since the donor conference. The humanitarian phase is nearing its end, the international presence is starting to move onto the next crisis, and high level international dignitaries have now returned to their capitals. The earthquake is no longer making headline news and the government is getting back to business as usual, albeit with the huge challenge of rebuilding.
Now is time to take stock of the events from the past three months. During a crisis, there is no time for those involved to look back at what has been accomplished. What matters is the next immediate action and challenge to overcome. Last week, in the Bank headquarters, our management and some members of the earthquake response team presented the progress achieved thus far to an overcrowded room. This was my first opportunity to reflect on the disaster and I was almost overcome with emotion. Be they senior government officials, the Bank’s country office team, first- emergency responders, or Nepalis, it is difficult to articulate just what folks have overcome in Nepal.
Nobody remembers an earthquake or a disaster this severe in their living memory. Aftershocks continue three months after the first earthquake, reminding survivors of their fragile, transitory existence. The scale of destruction is enormous, the remains visible even after efforts to clean, rebuild, and resettle. Gaping cracks in abandoned buildings waiting to collapse, tents in fields and pavements, parked vehicles that become shelters at night, rubble too enormous to be lifted to a landfill site, the occasional bulldozer – are all grim reminders of the tragedy. The skyline, once dominated by terracotta temples with tiered pagoda roofs, now is made up only of concrete masonry buildings.
More than 50% of today’s international trade goes through regional trading arrangements. While trade is a critical component of regional integration, integration has several other dimensions including energy cooperation and intra-regional investment, to name a few. After carefully examining cases of regional integration in Southeast Asia, the Americas and Africa, we present five lessons for South Asia.
Lesson 1: Facilitate trade in goods and services
Despite falling tariffs, there is still a large gap between the price of the exported good and the price paid by the importer, largely arising from high costs of moving goods, especially in South and Central Asia. On a percentage basis, the potential gains to trade facilitation in South and Central Asia, at 8 percent of GDP, are almost twice as large as the global average. High trade costs have contributed to South Asia being the least integrated region in the world.
FIGURE 1: Intra-regional trade share (percent of total trade), 2012
In the ASEAN region, most countries have established either Trade Information Portals or Single Windows that have enhanced trade facilitation, reduced trade costs and enhanced intra-regional trade. A Trade Information Portal allows traders to electronically access all the documents they need to obtain approvals from the government. A Single Window (a system that enables international traders to submit regulatory documents at a single location and/or single entity) allows for the electronic submission of such documents. These single windows, using international open communication standards, facilitate trade both within the region and with other countries using similar standards.
In services, one barrier to trade involves the movement of skilled workers, accountants, engineers and consultants who may move from one country to another on a temporary basis. The Southern Common Market (Mercosur)’s Residence Agreement allows workers to reside and work for up to two years in a host country. This residence permit can be made permanent if the worker proves that they can support themselves and their family.
Night falls in Dhaka. Commercial streets glow with lights and the neon-lit stores and restaurants are abuzz with shoppers enjoying a break from Ramadan. This is a great visual spectacle punctuated by the incessant honking of colorful rickshaws.
But the reality is different right outside the capital. Sunset brings life to a halt in rural areas as about 60 percent of rural households do not have access to grid electricity. Kerosene lamps and battery-powered torches are widespread yet limited alternatives, their dim light offering limited options for cooking, reading or doing homework.
It is a sweltering hot day when our team sets out to visit a household of 14 in the village of Pachua, a two-hour drive from Dhaka. Around 80% of the villagers have benefited from the solar panel systems to access electricity. The Rural Electrification and Renewable Energy Development Project (RERED), supports installation of solar home systems and aims to increase access to clean energy in rural Bangladesh.
We’re accompanied by Nazmul Haque Faisal from IDCOL, a government-owned financing institution, which implements the program. “This is the fastest-growing solar home system in the world,” Faisal says enthusiastically, “and with 40,000-50,000 new installations per month, the project is in high demand.”
We’ve now reached our destination and Monjil Mian welcomes us to his house, which he shares with 13 other members of his family, including his brothers, two of them currently away for extended work stints in Saudi Arabia.
“I am proud today to have acquired technical skills to get an edge in a constantly changing global job market. In 2014, I was lucky to get the chance to participate in the skills competition organized by Skills and Training Enhancement Project (STEP). After a month of hard-work, I was the winner. This motivated and inspired me to pursue my future career. Technical skills helped me achieve personal and professional fulfilment,” said Jarin Tasnima, a student of Computer Engineering Department of the Dhaka Mohila Polytechnic.
Following the footsteps of students like Jarin Tasnima, Bithi, an architecture student is planning to participate in the next skills competition, scheduled for the end of 2015. She is the youngest member of a family of four and lacked the financial means to pay for her school.
Her brother, an accountant found out that having technical skills led to better pay and increased social respect. He motivated his younger sister to choose a technical career path in which she selected architecture. After achieving a secondary school certificate, her dreams came true due to a stipend program at the Dhaka Mohila Polytechnic supported by STEP which paid her fees. “I am thankful to my brother for advising me to join Polytechnic Institute to enhance my career,” said Bithi.
About 9,000 lives have been lost to the devastating earthquake in Nepal on April 25 and the powerful aftershock on May 12. A conference in Kathmandu on June 25 will bring Nepal together with its international partners to build the country back better and safer.
Unfortunately, this is not just a Nepal challenge. From Afghanistan to Bangladesh, much of South Asia is located in one of the highest seismically active regions in the world. More than 600 million people live along the fault-line across the Himalayan belt that runs through Afghanistan, Pakistan, India, Nepal and Bhutan.
It has been 50 days since the devastating earthquake struck Nepal on April 25. With another powerful aftershock on May 12, a combined 9,000 lives were lost, making this the worst disaster in Nepal’s history in terms of human casualties. One in three Nepali has been affected by the earthquakes. One in ten has been rendered homeless. Half a million households have lost their livelihoods, mostly poor, subsistence farmers. Everyone has been affected in one way or the other – women, men, children, the elderly, the differently-abled. A large part of the country is in ruins.
Nepal is grateful to her friends in the international community for the rapid humanitarian response in the immediate aftermath of the disaster. We owe you our deep respect for your generosity and heroism.
Early estimates from our Post Disaster Needs Assessment (PDNA) price the damages and economic losses at US$ 7 billion, roughly one-third of our economy. The economic growth rate this fiscal year ending mid-July is expected to be the lowest in eight years, at 3.04 percent. Revenue collections will be off-target by at least 8 percent and result in a lower base going into the next FY. The immediate priority is to restore the productive means of livelihood for millions of people in agriculture, services and industry.