THE slight improvement in Pakistan’s ranking on the Global Competitiveness Index is of only notional value. It will not bring about any change in the challenging environment in which the economy has been operating for some years now. Nor will the country’s elevation on the index make us any more efficient and productive than we were a year ago, or be sufficient to attract investors or speed up recovery. Macroeconomic volatility, political instability, inadequate energy and other infrastructure, deteriorating security conditions and surging violence in many parts of the country continue to stall recovery. Similarly, a low literacy rate, almost non-existent health coverage for a vast portion of the population, a corrupt bureaucracy and an untrained labour force are creating greater inefficiencies in the economy. The World Economic Forum’s Global Competitiveness Report 2011-12 has emphasised the country’s poor performance in many of these areas while ranking it five places higher at 118 out of 142 economies this year.

Without any prejudice to the higher rating, one is constrained to urge policymakers to focus on that part of the report which singles out the country as one of the worst “performers of the developing Asian region, and indeed of the entire sample of economies in several categories” rather than on its ‘improved’ ranking. We still continue to lag behind 117 countries listed above us on the GCI. This is not the way for Pakistan to prosper and grow. If the economy has to be put back on the path of a faster and sustainable recovery the factors affecting the competitiveness of businesses and stalling investment will have to be addressed immediately. Formulation of a long-term policy for achieving energy security using local resources and the implementation of fiscal and governance reforms can be a start. At the same time, the government must create fiscal space for the substantially increasing public investment in the social and economic infrastructure in order to increase productivity and enhance efficiency. Other-wise, the country’s ranking on the GCI will keep hovering round the same position, sometimes dropping a few places and at others rising a few places.