The World Economic Forum (WEF) has ranked Pakistan at 122, last amongst its South Asian neighbours, where India leads at 39 followed by Sri Lanka 71, Bhutan 97, Nepal 98 and Bangladesh at 106 at the Global Competitiveness Index (GCI). The Global Competitiveness Report 2016-17 competitiveness ranking is based on the Global Competitiveness Index (GCI), which was introduced by the WEF in 2005. To improve the soft-data on Pakistan, the WEF worked with Mishal Pakistan, the country partner institute of the Global Competitiveness and Benchmarking Network.
Defining competitiveness as the set of institutions, policies and factors that determine the level of productivity of a country, GCI scores are calculated by drawing together country-level data covering 12 categories - the pillars of competitiveness - that collectively make up a comprehensive picture of a country's competitiveness. The 12 pillars are: institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labour market efficiency, financial market development, technological readiness, market size, business sophistication, and innovation. This year among 114 global competitiveness indicators, Pakistan showed improvements on 54 key indices, whereas on 50 indices the country lost its previous position, while 10 indices remained same as last year.
According to the report, Pakistan has shown recovery on the economic front, where the country has been successful in improving its macroeconomic framework to improve its global competitiveness.
Pakistan improved from 119 in 2015-16 to 111 in 2016-17 on the institutions pillars, while infrastructure improved only one point and stands at 116 this year. On the Macroeconomic Stability Pillar Pakistan jumped from 128 in 2015 to 116 in 2016-17. A solid 8 points gain, which shows the country has made economic progress on gross national savings percentage of GDP, where Pakistan improved from 115 in 2015 to 107 in 2016-17. While the government debt percentage to GDP also ranks at 95 in 2016-17 among 138 economies in the world, the biggest gain however is in the area of inflation annual percentage change where Pakistan moved from 127 in 2015 to 93 in 2016.
On other pillars, among 138 countries, Pakistan ranks for Health and Primary Education at 128, Higher Education and Training at 123, Goods Market Efficiency at 117, Labour Market Efficiency at 129, Financial Market Sophistication at 107, Technological Readiness at 119, Market Size at 29, Business Sophistication at 95 and Innovation at 75.
The report also shows performance of some of the key regulatory bodies and other government institutions, which have shown progress as well. Among 138 countries the institutions are ranked as: Intellectual Property Organisation (109), Judicial Independence (88), Police Services (118), Auditor General of Pakistan Revenues (121), National Highways Authority (77), Pakistan Railways (53), Civil Aviation Authority (91), NEPRA (121), Higher Education Commission of Pakistan (115), National Vocational and Technical Training Commission (97), Competition Commission of Pakistan (96), Pakistan Customs (113), State Bank of Pakistan among other 138 Central Banks at (101), Securities and Exchange Commission of Pakistan at (106) and Trade Development Authority of Pakistan (135). The SECP of Pakistan has been losing its global ranking at an alarming rate from 51 in 2014 to 106 this year.
The Global Competitiveness Report 2016-2017 also identifies Corruption as the most problematic factor for doing business in Pakistan, followed by crime and theft, tax rates, access to finance and government instability and coups. The report also indicates that a ten-year decline in the openness of economies at all stages of development poses a risk to countries' ability to grow and innovate.
The degree to which economies are open to international trade in goods and services is directly linked to both economic growth and a nation's innovative potential. The trend, which is based on perception data from Global Competitiveness Index (GCI)'s Executive Opinion Survey, is gradual and attributed mainly to a rise in non-tariff barriers although three other factors are also taken into account: burdensome customs procedures; rules affecting FDI and foreign ownership. It is most keenly felt in the high and upper middle income economies.
"Declining openness in the global economy is harming competitiveness and making it harder for leaders to drive sustainable, inclusive growth," said Klaus Schwab, Founder and Executive Chairman, WEF. Chief Executive Officer of Mishal Pakistan said Pakistan has shown improvements on some of the key indicators to improve its global competitiveness; however the country still needs to integrate itself into the digital and cyber world. Pakistan with approximately 186 million population offers great prospects if data and knowledge-based policy making is introduced in the country.
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