In a report titled “The Long View – How will the Global Economic Order Change by 2050” prepared by the PricewaterhouseCoopers (PwC), headquartered in London, Pakistan will regale impressive growth rates over the next three decades, surpassing nations like Canada and Italy, to become the world’s 16th biggest economy up to 2050.
Some of the other emerging economies such as Indonesia, Brazil and Mexico were also expected to be larger than the UK and France by that time. A table in the report indicates that on the basis of purchasing power parity (PPP), Pakistan would climb from its current 24th place (with GDP at PPP amounting to dollar 988 billion) to 20th place (dollar 1.87 trillion) by 2030 and to 16th place (dollar 4.12 trillion) by 2050. In terms of GDP at real market exchange rate (MER), Pakistan’s economy was projected to rise from 28th place (dollar 284 billion) at present to 27th by 2030 (dollar 776 billion) and to 19th place (dollar 2.8 trillion) by 2050.
On PPP basis, both Pakistan and Egypt could overtake Canada and Italy by 2050. The largest movers over the next 35 years are projected to be Nigeria, Vietnam and Pakistan. Other findings of the report indicate that China has already overtaken the US to become the world’s largest economy in PPP terms while India currently stands in third place and is projected to overtake the US by 2050. France will no longer be among the world’s 10 largest economies on this basis, with the UK falling to 10th place while Indonesia could move up to 4th place. The world economy, on the whole, could more than double in size by 2050.
The projected improvement in the global ranking of Pakistan’s economy, both in PPP and MER terms, would of course be a pleasant news for the economic policy planners of the country. It obviously means that the economy of the country is on the right track and poised to make handsome gains over the next 35 years or so. Such a rapid progress over a long period of time would certainly reduce poverty and unemployment and raise the standards of living of the poor and ordinary people of the country.
However, the overtaking of Canada and Italy by Pakistan should not be construed to mean that life of Pakistani citizens would, in general, be better than Canadians or Italians by 2050 because the ranking is based on the aggregate amount of GDP and has nothing to do with per capita income. Anyhow, it is interesting to know that China and India are also threatening the supremacy of the US in ranking and could overtake it in terms of the overall volume of GDP in the next three decades. Such a change in ranking would of course disturb the status quo and could give a new shape to the existing world order, especially in the decision-making of the UN and its various agencies.
The ranking of Pakistan by PwC is particularly quite interesting. Its economy is projected to grow more than three times within the next three decades in PPP terms and expected to record a whopping nine times jump in MER terms. Other largest movers over the next 35 years are projected to be Nigeria and Vietnam. However, these projections are based on sustained economic reforms and very sensible, conducive policies over this period.
Coming back especially to Pakistan, whether the country would be able to revert and sustain such policies would be a moot question. The experience suggests that it is a very difficult proposition and policies of the country would continue to be governed by political expediency rather than economic imperatives.
Moreover, it has been assumed that Pakistan, like some of the other emerging economies, would tend to benefit from strong population growth and a higher growth rate in working age population would be a boon instead of a bane for the economy. In other words, Pakistan would be one of the countries that would enjoy very high growth because of its increasing size in working age group.
However, such a strategy could only bear fruit if the labour force was educated. If this cannot be done, strong population growth could only cause political and social instability. Keeping all these factors in view, the report of the PwC could be a pleasant reading but is not something to cheer about. It could only be gladsome if we are doubly serious about revising our policies and changing the fortunes of the country. -Business Recorder