1 / 22

Towards Growth Strategy & Economic Reform

Towards Growth Strategy & Economic Reform. Planning Commission. Outline. What is the Current Growth Strategy? What are Constraints to Economic Growth? Why Move towards a New Growth Strategy? What is Planning Commission’s Approach? New Growth Strategy – Brief Overview

loe
Download Presentation

Towards Growth Strategy & Economic Reform

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. Towards Growth Strategy & Economic Reform Planning Commission

  2. Outline • What is the Current Growth Strategy? • What are Constraints to Economic Growth? • Why Move towards a New Growth Strategy? • What is Planning Commission’s Approach? • New Growth Strategy – Brief Overview • What should be the New Role of Government?

  3. What is the Current Growth Strategy? • Growth policy by default • Projects being multiplied with no available resources • Regulated markets and sector picking • Result • Sporadic growth usually created by external resources • Preoccupation with crises and stabilization • Lack of structural reform No Long Term Thinking on Growth Strategy

  4. What are Constraints to Economic Growth?

  5. Pakistan Lacks Growth Software Hardware Software Source: Global Competitiveness Report

  6. Why Move Towards a New Growth Strategy? Projected Population by Age Groups • A bulge in the working age groups in coming 40 years • This increases potential productive capacity • BUT also raises challenges: • UNEMPLOYMENT without adequate investment • COMPETING South Asian countries also have young populations 65> Million

  7. Why Move Towards a New Growth Strategy? • How much economic growth rate is required to absorb growing labour force? • Expected long run labour force growth rate is 3.6% • Absorbing incremental labour requires 8% GDP growth

  8. Planning Commission’s Approach to a New Strategy • Home grown • Donor-driven models not working across developing countries • Growth possible during stabilization • Taking stock of local knowledge • Consensus-driven • Meeting all segments of society including academia, civil society, business community • Detailed consultation with provinces

  9. New Growth StrategyEconomic Conceptualization

  10. New Economic Growth Strategy

  11. Short Term: Getting back to potential • Utilization of existing capacity • Up to 30% in industry • Up to 50% in fertilizer, auto sector, sugar, cement and steel • Requires: • Removing major constraints • Energy (Electricity and Gas) • Availability and pricing of credit • Macroeconomic stability

  12. Economic Growth Longer term: Increasing Potential • Physical Capital • Human Capital • Productivity • Public Investment • Skills • Education Sector based & Project based Missing: Innovation, Entrepreneurship & Markets

  13. Growth Alternatives (2011-15) • Stabilization : Reform of PSEs, increase resource mobilization (Average 4.7%) Business as Usual: Low aid-led public investment, high Inflation (Average 3.5 %)

  14. Growth Alternatives (2011-15) Stabilization + Reform: Market reforms & productivity gains (Average 5.6%) • Stabilization : Reform of PSEs, increase resource mobilization (Average 4.7%) Business as Usual: Low aid-led public investment, high Inflation (Average 3.5 %)

  15. Ongoing PSE Reform Efforts

  16. PSDP Resource Allocation Strategy Prioritizing PSDP • Projects nearing completion • Social sector projects • Key infrastructure projects: energy, water, transport • Projects for removing regional disparity PSDP Weaknesses • Decreasing PSDP Size • High share of bricks & mortar (60% of total in 2011) • Money Spread thin (large sectoral & regional spread) • Project governance

  17. Potential Governance Agenda

  18. Markets & Entrepreneurship

  19. Cities as Hubs of Commerce

  20. Youth & Community

  21. New Role of Government Markets Government

  22. Thank You Thank You www.pc.gov.pk

More Related