Muhammad Asad Tahir Bhawana

Pakistan has experienced a decline in performance in crucial and fundamental aspects of competitiveness, needing a boost to leverage its resources through merit, quality, and innovation, said a report prepared by the Ministry of Planning and Development, reports WealthPK. The Global Competitiveness Index (GCI) of the World Economic Forum (WEF) shows Pakistan to be less competitive than the upper-middle-income economies. Out of the 12 indicators ranging from 1 (worst) to 7 (best), Pakistan ranks significantly lower than its neighbours on 8. Pakistan ranks 133rd out of 148 countries in terms of competitiveness by the GCI, far behind the comparator countries.

Additionally, Pakistan has experienced a decline in performance in crucial and fundamental aspects of competitiveness. The public institutions rank 126th, and are severely hindered by inefficiency, corruption, favouritism, and inadequate protection of property rights. The security situation not only poses a significant threat to the population but also has adverse effects on businesses.

Pakistan’s competitiveness is further impacted by the numerous rigidities and inefficiencies present in its labour market (ranked 138th, down by eight places), with female participation in the labour force being among the lowest globally (ranked 144th). Furthermore, the potential for ICTs has not been fully realized, as these are still a privilege for a few (118th place). Pakistan performs worse on Basic Requirements than Efficiency Enhancers and Innovation/Sophistication factors.

According to the report, Pakistan is predominantly excluded from the global value chains, finding itself in a position where it primarily exports products of relatively low value and relies on remittances generated by predominantly low-skilled workers who seek employment overseas. This situation prevents Pakistan from actively contributing value within its domestic borders by engaging in the growing interconnected global service economy.

These challenges are interrelated, and addressing one will positively impact the development of others. It is crucial for Pakistan to emphasize and support promising sectors. The report says a comprehensive strategy will be devised to address significant challenges while capitalizing on competitive advantages. This will enable Pakistan to enhance its overall competitiveness and foster growth.

“Further, Pakistan Vision 2025 aims to achieve income growth by focusing on continuous enhancements in total factor productivity instead of relying solely on increasing input levels. The nation is dedicated to enhancing national competitiveness by harnessing knowledge to drive efficiency improvements. It is envisioned that enterprises in all sectors will be transformed into sustainable and viable entities without prolonged reliance on protectionist measures or subsidies. These enterprises will be developed to effectively compete in both regional and global markets. By 2025, the goal for Pakistan is to be ranked among the top 50 most competitive countries in the GCI.”

Credit: Independent News Pakistan-WealthPk

The report further says enhancing accessibility and quality of primary education and healthcare constitutes a foremost objective within the framework of Pakistan Vision 2025. Additionally, the significance of higher education cannot be undermined, as it is crucial for harnessing the advantages of technological progress and fostering effective competition. Pakistan Vision 2025 strives to achieve a twofold increase in the coverage of higher education within the country.

“A more flexible labour market will be achieved in Pakistan through the easing of unnecessarily restrictive regulations, as well as bringing an end to uncoordinated and intrusive inspections conducted by various authorities throughout the country. Similarly, a key component of Pakistan Vision 2025 is to promote the development of synergistic industrial and academic resources through the efficient, sustainable, and effective implementation of ICT initiatives.”

“As part of the initiative, technology parks would be established to enhance the nation’s technology base, develop efficient systems in the public and private sectors, promote R&D, produce goods and services that meet international standards, establish a regional innovation system, facilitate knowledge transfer from universities and public research centres to businesses, stimulate quality in all management processes, and oversee research, development, and innovation,” adds the report.