New Delhi, Dec 27 State Bank of Pakistan Governor Jameel Ahmad's warning that Pakistan’s growth model is "unsustainable" for a population of 250 million comes at a time when business cycles in the country shorten, and each recovery is weaker than the one before, a report said on Saturday.
The report from European Times said that the comment came at a time when Pakistan is suffocating under soaring poverty, historic unemployment, and a prolonged phase of stabilisation that has crushed households and businesses alike.
"Pakistan may have been living on borrowed time. Now, its chief banker is saying the clock has all but run out," the report said.
Pakistan has been locked in a cycle of "corrections", each accompanied by suffocating taxation, punishing energy tariffs and deep cuts that hit ordinary citizens hardest, it added.
"With each round of stabilisation, the cushion for households and industries shrinks, while the structural defects that make stabilisation necessary remain untouched," the report added.
The report called the slowdown a structural decline, against the backdrop of decades-long economic stagnation. Growth has been grinding downward, from an average of about 3.9 per cent over 30 years to just 3.4 per cent in the last five years.
It said Pakistan’s economic model, built on consumption spurts, cyclical borrowing and stopgap stabilisation, cannot support the needs of 250 million citizens.
The European media house said that the script of seeming economic support repeats every year. "The country runs out of reserves, inflation spirals, the currency slumps, and the IMF is summoned for another rescue package. Stabilisation measures follow, growth collapses, poverty spikes, and once the crisis abates, the cycle begins again," it said.
Unemployment has climbed to a 21-year high of 7.1 per cent, with millions unable to find work in an economy that can no longer extend opportunities. World Bank data found poverty has surged to 44.7 per cent in the country, the report noted.
—IANS
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