'Poverty reduced by 11 percent due to economic policies'

[Neo]

'Poverty reduced by 11 percent due to economic policies'

LAHORE (May 09 2007): Poverty has reduced by 11 percent due to the comprehensive economic policies of present government and 3 million jobs have also been created during the last three years; reforms have been introduced in all departments to provide basic facilities to common man and fruitful results have been achieved as well.

Punjab Chief Minister's Inspection Team Minister Colonel (Retd) Shuja Khanzada expressed these views while talking to various delegations of nazims and workers of PML here on Tuesday.

He said that the government was taking steps on priority basis to maintain law and order and to provide daily use items at reasonable rates to all segments of society. He further said that special directions had been issued to the Members of CMIT to keep vigil on the prices of goods in their respective areas. "If any shopkeeper is found involved in over charging, take legal action against him and get cases registered against the defaulters," he directed the delegation.

He further said that members CMIT would also inspect police stations and listen to the complaints of people. He warned that strict action would be taken against such officials and officers who fail to redress the complaints of general public.

He said that crime ratio has been reduced due to set up of patrolling posts throughout the province; 250 patrolling posts have been established while 250 more posts are being set up, he added.

http://www.brecorder.com/index.php?id=561583&currPageNo=1&query=&search=&term=&supDate=

 

[Neo]

Poverty head count down to 23.9 percent

FAISALABAD (May 18 2007): The poverty head count which stood at 34.5 percent in 2000-01 has come down to 23.9 percent by 2004-05 - a substantial decline of 10.6 percentage points.

Talking to various delegation at Shah Jewena District Jhang, Federal Minister for Environment Makhdoom Syed Faisal Saleh Hayat said, in absolute numbers the count of poor persons has fallen from 49.23 million in 2000-01 to 36.45 million in 2004-05 - a fall of 12.8 million.

Rural areas of the country have witnessed a higher fall in poverty, where the percentage of population living below the poverty line has declined from 39.3 percent in 2000-01 to 28.1 percent by 2004-05, while urban poverty fell from 22.7 percent to 14.9 percent during this period.

This substantial decline in poverty has been made possible by robust economic growth, combined with the rising expenditures on the 17 pro-poor sectors identified in the PRSP.

PRSP budgetary expenditures on the 17 pro-poor sectors amounted to Rs 434.6 billion in 2005-06, while cumulative PRSP expenditures (budgetary as well as non-budgetary) during 2001-06 amounted to Rs 1,441 billion, with the budgetary expenditures averaging 4.7 percent of the GDP during this 5 year period.

Earlier, addressing a public gathering after inaugurating a bridge at Loheywala, Sargodha Road, and a road (Market Committee Road) in his constituency near Mandi Shah Jewna he said record development schemes had already been completed while more schemes were being executed to provide maximum civic amenities to the residents of this constituency.

He further said people should support this government to complete the ongoing projects in addition to launching new mega development projects to strengthen the national economy.

All promises made to the people during the last elections would be fulfilled before next elections, he said. He added locality of Loheywala was earlier cut from the rest of the district during flood season. However, this bridge had provided a reliable and permanent road link to the residents of the locality.

He said that this bridge had been completed with an estimated cost of Rs 2 million while Rs 1.3 million had been spent on the construction of the Market Committee Road.

http://www.brecorder.com/index.php?id=565602&currPageNo=1&query=&search=&term=&supDate=

 

[james02]

It is always a good thing when the poverty levels indicate decline, after all this implies that some work is being done in this field. At present I am working for a reputed company and am well and truly stable financially but I know a lot has to be done for the minorities who find it hard to earn the bread and butter for the day. So the sooner this rate declines the better it is for the entire economy.

 

[Neo]

James,

Fighting poverty is a true challenge for our government. Pakistan has a population of 160 million, a quarter or some 40 million live below poverty line while approx 30 million make $8.000-10.000 a year.

Due ststained high growth we've been able to lift atleast 1% of the population from poverty per year but much more needs to be done to reach the hard core, i.e. the ill educated low skill youth that didn't make it to school end up in the worse paid lousy jobs in the labor market, there's less hope for those but I certainly hope their next generation will be able to grant a more prosperous future if the government succeeds in reaching the millenium goal of reducing poverty to 12.5% by 2015.

 

[Shehz]

What should and is necessary in a free market and Islamic country keeping in mind Islamic values that the govt should establish an effective system to take care of basic needs of people so their limited amount of income is not spent just to keep their electricity going or water running and feeding the family.

If our govt was to honestly determine the comfort zone income which takes care of the basic needs of a family and provide grants to poor folks to supplement their income to raise to comfort zone, we wouldn't have poverty and the country's per capita income and standard of living would rise considerably.

The reason we have so much poverty and extreme income inequality because the govt is not properly distributing the right amount of money on people's welfare as its blindly following the western formulaes of capitalist economic system where every man is on its own and the govt is run more like a corporation to minimize its expenses and maximize its revenues.

In terms of GDP or GNP, the govt share has been increasing constantly year on year and is now somewhere near 20% of the GDP. This includes expenditures related to govt's operations and its spending on Public sector development. Education, health and welfare spending are very critical aspect of any govt structure and unfortunately, in our govt, they are ineffecient, inadequate and filled with corruption.

How is it possible that almost every year there is a significant amounty of money left over from the Zakat fund and Public sector development. Last year the amount of money that was allocated for PSDF was Rs. 180 billion but we only spent some Rs. 110 billion. Did the govt ran out of poor folks or was it the incompetent atmosphere of our govt culture that resulted into this. ADB even warned the govt that it will not provide any more funds if the plans are not effectively implemented.

So in my opinion we need to balance capitalist approach with the Islamic approach in running the economy and government in our country. As there is no restriction in Islam for rich to be richer, but there is a compulsion on the govt to fullfill people's basic needs for them to be able to live peaceful life. We have to understand that a poor who is stressed and worried 24/7 just to feed his family is not going to be a productive citizen, and also that spending few billions more on satisfying basic needs of the poor folks is not going to make the govt go bankrupt. As these few billions will have a higher return when the poor folks have less stress and worries about their food and clothing and more energy about starting a business or improving their means of earnings.

 

[Neo]

WB approves $350m credit for Pakistan

ISLAMABAD: The World Bank has approved US$350 million credit to support the Government of Pakistan’s medium-term reform program, which aims to promote sustained, rapid economic growth as its main vehicle for poverty reduction, says a press release issued here on Wednesday.

The Second Poverty Reduction Support Credit (PRSC II), which supports the government’s Poverty Reduction Strategy Paper, will finance reforms designed to maintain macroeconomic stability, improve management and effectiveness of public expenditures, and assist power sector reforms. It will also support the privatization program, improve the regulatory framework for competition, and enhance female labor force participation and labor market flexibility.

Over the last six years, Pakistan has emerged as one of the fastest growing economies in Asia, with a rising per capita income, and improving social indicators. Growth has averaged 7 percent between April 2003 and June 2005 and the poverty headcount ratio has fallen significantly in recent years. The country has also made impressive strides in deregulating its economy to increase competition and reduce cost of doing business, and implementing structural reforms, particularly in the power sector.

“Economic reforms are now contributing to increased investor interest from Pakistanis and foreign investors alike,” said Yusupha Crookes, the World Bank Country Director for Pakistan.

“The ongoing reform program supported by this project will contribute to sustaining rapid growth. We hope this, along with policy reforms and public investments to increase poor people’s participation in the economy, will accelerate the country’s progress towards reaching the Millennium Development Goals.”

The PRSC II will also support improved governance through reforms in financial management, procurement, and the statistical system. It will help accelerate progress in human development by creating additional public resources for education and health, and strengthening national policies for the two sectors.

“The PRSC supports the poorest and most vulnerable segments of the population through targeted programs aimed at addressing poverty and vulnerability directly,” said Zahid Hasnain, World Bank Senior Economist and project co-task team leader. “It will also support efforts of provincial governments in improving the quality and access of underserved populations to health and education services.”

This credit, from the International Development Association (IDA), the World Bank’s concessionary lending arm, carries a 0.75% annual service fee, while a portion of this credit (less than half) also carries an interest charge of 4% p.a. The entire credit has a 10-year grace period, and a maturity of 35 years.

http://www.thenews.com.pk/daily_detail.asp?id=57305

 

[Neo]

Rs 447.4 billion spent on pro-poor sectors this fiscal year

ISLAMABAD (May 24 2007): The government has spent Rs 447.4 billion on pro-poor sectors under poverty alleviation programme in the current financial year. Sources in the Social Welfare Ministry told Business Recorder on Wednesday that the amount was spent on 17 pro-poor projects.

An amount of Rs 12.76 billion was spent through non-budgetary transfers that include Zakat, micro-finance and employees old-age benefits institutions under poverty alleviation programme. Under human development projects, the sources said, Rs 141.70 billion was spent on the education sector to provide scholarships to needy students to complete their education.

However, the government failed to initiate uplift projects on Twana Pakistan plan and despite efforts, nothing was done except hollow slogans. An amount of Rs 39.20 billion was spent on the health sector as free medicines and life-saving drugs were provided to needy patients. About Rs 63.59 billion was spent under community services programmes and Rs 53.25 billion was spent on constructing and repairing roads, highways, and bridges.

Moreover, Rs 10.34 billion was spent on water supply and sanitation programmes, they said. Sources said that Rs 19.15 billion was spent on meeting natural calamities. An amount of Rs 78 billion was spent under rural development programme of which Rs 59.82 billion was spent on irrigation, Rs 15.04 billion on rural development projects, Rs 1 billion on rural electrification, and Rs 2.67 billion on land reclamation, they added.

They said that Rs 3.08 billion was spent on Food Support Programme. However, despite huge expenditure on the project no ground improvement was visible. An amount of Rs 0.30 billion was spent on low-cost housing schemes for the poor and Rs 6.02 billion was spent for food subsidies, they added.

The government has spent Rs 59.52 billion on law and order situations, Rs 5.64 billion was spent on administration of justice while judiciary itself remained a victim of injustices by the government what to talk of dispensing justice to common man at the doorstep.

http://www.brecorder.com/index.php?id=568128&currPageNo=1&query=&search=&term=&supDate=

 

[Neo]

Prime Minister's plan to help eradicate poverty

PESHAWAR (May 26 2007): Sarhad Chamber of Commerce and Industry (SCCI) President Liaquat Ahmad Khan has said the Prime Minister's programme "Aik Hunar Aik Nagar" (AHAN) will not only help eradicate poverty from the backward areas, but will also bring them in the mainstream of development.

He expressed these views while addressing a briefing on "AHAN" at SCCI on Friday. General Manager Operation Smeda, Syed Iqbal Qadwai, Manager Marketing and Networking AHAN, Shehiyar Tahir, Smeda Provincial Chief, Javed Iqbal Khattak, Regional Manager AHAN, Shakeel Ahmed, industrialists and members of SCCI were also present on the occasion.

Liaqat Ahmad Khan said that female can not only earn money and support their families through AHAN but can also play a vital role in the country's economy. He also proposed extension of the programme to jails and Darul-Aman to facilitate the maximum number of people.

Manager Marketing AHAN, Shehiryar Tahir while shedding light on the aims and objectives of AHAN said that the prime objective of the programme is to ensure market access to the indigenous products. GM Operation Smeda, Iqbal Qadwai, Haji Muhammad Asif and Regional Manager AHAN, Shakeel Ahmad also spoke on the occasion.

http://www.brecorder.com/index.php?id=568853&currPageNo=2&query=&search=&term=&supDate=

 

[Shehz]

Poverty is impacted by a number of factors, some of these may be in general in that they may serve to create or intensify privation accross all sectors of the economy,and across different population groups. Other causes of poverty may be more specific or localized or their effects may be more apparent in particular population groups, or populations associated with specific sectors of the economy.

In most case, however, poverty in Pakistan is likely caused by severally mutual reinforcing factors, that together define it's scope and pervasiveness, such as; Poor Governance, Political Instability, Non transparency in resource allocation, weak public sector capability, Inadequate access to justice, economic determinants, investment, fiscal policies, subsidies, employment, inflation, remittances, Social determinants, land tenure, societal structure, low level human resources development, ethnic and sectarian conflicts, environmental degradation, health, and natural resources.

If I go to explain all of the above factors in-debth, PFF will run out of band width, however, Ill go with unemployment: Which has hit an all time low of 6.2% (2007), and that has acted as a catalys to lower our poverty level.

Unemployment is measured annually as the percent of the labor force that cannot find a job. The labor force comprises adults who want to work. Uncounted are those who do not seek employment, or who have become discouraged enough to stop looking.

 

[Neo]

Excellent analysis Shehz, I couldn't have explained it better!

Accoding to some sources the sitting givernment has been very successful in facilitating employment, 11 million new jobs have been added in past seven years, the impact is visible thru poverty decline.

Major challenge however exists in the form of high inflation since it strikes the poorest the most, specially in the urban area as poors in rural area's usually enjoy self sufficiency in many food items.

Creating jobs for low skill labor in urban area's and providing small credits to all thruout the country would help us reach the MDG of reducing poverty to 12.5% by the year 2015.

 

[Shehz]

I'd personally like to see it drop down to 11%.
There is so much development work going on in Karachi, Gawadar and Punjab, employment has to be created (for instance, road network, train network, ports, Karachi water front, new airport, etc)., but again, on a cumulative basis, the entire country is being unable to sustain that growth due to political implications in Balauchistan and NWFP.

Nevertheless, let us go a bit deeper into poverty.
Poverty characteristics in Pakistan includes high level of income and asset poverty, economic and social vulnerebility, gender disparity and low levels of human resorce development.

The declining trend of poverty in Pakistan in the 19890's was reversed in the 1990's, most of it being after 1997 coinciding with slow growth in the country, and has remained ever since as the central challenge of the government.

Now how is poverty statiscs calculated?
The most commonly used standard to meassure income or consumption related poverty involves calculating a poverty line (based on some minimum acceptable level of consumption) and estimating the proportion of estimating the population below that line, and unfortunaly, there has never been a uniform methodology for estimating poverty, and that has been the cause of considerable uncertainty.

Other methods include spatial dimensions (rural & Urban), agricultural growth, regional differences, gender dimensions, economic & social vunerability, literacy levels, health, personal assets, labour (gender parity), and Wellfare.
These methods of calculating will allways fail, as in gender, women barely contribute, personal assets are never declared, no one goes to the doctor for periodical check up's regularly, and social vunerablity, well we can't deny that.

Going back to your suggestion, as a finance wizzard one can argue to create jobs in urban area's. As an ecnomist, the plan will fail as again, we come back to social and gender disparity.

Poverty, to meassure goes much deeper, and I'm not in a position to give expert opinion.
However, with regard to economic factors, decline in the GDP rate is the immediate cause in the increase in poverty.

So, if our poverty level has declined, it invariably means our GDP rate has improved!!

 

[MirBadshah]

World Bank Report on Pakistan's economy


Growth in Pakistan



After a decade of anemic economic growth, Pakistan’s economy has grown by more than 6.5 percent per year since 2003. While income inequality has increased somewhat, poverty has declined significantly.

Exports (in US$ terms) have grown by over 15 percent since 2004. Investment as a share of GDP increased from 17 percent in 2001/02 to 20 percent in 2005/06.

A wide-ranging program of economic reforms launched in 2000 – fiscal adjustment, privatization of energy, telecommunications, and production, banking sector reform and trade reform – have played a key role in the country’s economic recovery. Granted, they were not only factors. The external environment of low interest rates, abundant liquidity, and robust external demand, has also been favorable for the country's growth. Increased levels of concessional external assistance – including from the World Bank - and debt restructuring, also played a role. And after 2001, increased remittances and the additional external support provided by the US (which some have termed as "the September 11 windfall") helped increase the cushion of external reserves.

Pakistan's economy has shown great resilience in the face of the devastating earthquake, and future growth prospects for the economy are good. To sustain rapid growth over an extended period of time, Pakistan needs to further increase the quantity and quality of investment. For this to happen, it has to sustain reforms to reduce the cost of doing business and encourage productivity of labor and innovation; to invest in public infrastructure and education and health; and address the growing macroeconomic imbalances, especially with regard to the current account.

World Bank's Involvement

The World Bank’s engagement in Pakistan is on helping identify constraints to growth, and to devise ways to remove them. The Bank recently published an economic report on Growth and Export Competitiveness. The Bank will hold a Growth and Competitiveness Conference in December 2006, and will prepare economic reports on tax policy and public expenditure in 2007 and 2008.

It has also prepared a series of trade-related policy notes. Maintaining macroeconomic stability – something that Pakistan’s own history reveals has been difficult to achieve, remains an important focus of the World Bank’s work in Pakistan. The World bank is working in partnership with the Government in systemic reforms to improve governance and to improve service delivery, with focus on civil service reform and procurement and financial management reforms. Structural reforms to improve the business environment and governance at the national level have been supported through program support operations – in particular the Poverty Reduction Support Credits. In addition, the World Bank has also compiled Provincial Economic Reports which analyze the Provinces' growth potential, and identify specific policy recommendations for provincial governments to accelerate development. These reports have been completed for Punjab, North West Frontier Province, and Sindh. The report for Balochistan, as well as provincial fiscal policy notes, are under preparation.

A key focus of the Bank’s work in Pakistan is in contributing to inform the policy debate on poverty, in particular on its determinants, trends, and measures to address. The Bank has recently prepared a Poverty Update, and will be preparing a Poverty Assessment in 2007.


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