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3m people entering poverty bracket every year: Dr Pasha
Islamabad: Speaking as a keynote speaker at the concluding plenary of the 17th Sustainable Development Conference organised by Sustainable Development Policy Institute (SDPI) in Islamabad, former finance minister Dr Hafiz Pasha said that in the current scenario Pakistan has no option but to follow the path of inclusive growth and sustainable development. “Food inflation and the rising prices of flour, which have actually risen by 50% in real terms over the last few years, are the issues which need immediate attention of the government,” Mr. Pasha said. He further said unemployment in the country has actually reached 12%, and three million people are entering the poverty bracket every year as the real household income of top 20% went up by 40%, whereas the income of the people belonging to lowest 20% have only risen by 6%.
Reports in the media attributed to the Ministry of Finance said that the Government of Pakistan has decided to avail loans from the World Bank for mega-development schemes only, de-prioritising poverty alleviation, sustainable livelihoods and people-centric projects.
This move to abandon the poor of the nation to their own devices is dismaying after the efforts the Government of Pakistan so far, with the support of international donors, taken to address poverty. The work in the microfinance and sustainable livelihoods sectors has positively impacted the lives of millions and helped stabilize households and communities across Pakistan. The microfinance sector has performed extraordinarily in a challenging macroeconomic environment since the Government of Pakistan established the Pakistan Poverty Alleviation Fund (PPAF), the apex institution, in the late 1990s to finance any legally established entity in the government or private sector, and microfinance organizations set up the Pakistan Microfinance Network (PMN), the sector association, in 2001.
PPAF’s success at inclusive development through strategically sound interventions despite the complex hurdles in the environment has been acknowledged globally. The International Fund for Agricultural Development (IFAD) recognized PPAF’s Programme for Increasing Sustainable Microfinance (PRISM) project for addressing gender inequalities and empowering women with the Gender Award in Asia and the Pacific Region for 2014 – an award for which Pakistan beat out projects in India and Indonesia.
The Pakistan Microfinance Review 2013, an annual assessment of the Microfinance Industry, records the previous fiscal year as being one of continued expansion in the microfinance industry in Pakistan as microcredit outreach witnessed substantial growth in the year 2013 where the number of active borrowers grew by 21 percent to touch 2.4 million and the sector gross loan portfolio (GLP) grew by a staggering 41 percent to close at PKR 46.6 billion.
In a global economy recovering from a recession, the standards of living and state of well-being of the poor have been steadily worsening. Access to finance and social mobilization provide integral safety nets to the vulnerable and interventions such as microcredit ensure that the entrepreneurial poor are in a position to supplement or enhance their incomes. Recently, the “Global Microscope on the Microfinance Business Environment 2013,” a report by The Economist Group, stated, “Pakistan … is considered to have one of the most enabling environments for microfinance regionally and globally,” assessing regulatory and market-entry conditions, business practices and client interaction.
Institutions such as the State Bank of Pakistan, which facilitates access to finance, and the Pakistan Poverty Alleviation Fund, with the support of the Ministry of Finance and donor funding from the World Bank and IFAD, have ensured that the microfinance sector develops sufficiently to be a significant tool in the struggle for poverty alleviation. Poverty alleviation and sustainable development remain challenges, which these organizations are determined to mitigate.
Qazi Azmat Isa, CEO of PPAF, said, “Poverty is a complex challenge – and not just poverty but inequality is an issue that PPAF focuses on as well. Inclusion of the poorest, the most geographically remote communities, of women and of people with disabilities is a core feature of PPAF’s work. PPAF has supported the formation of over 120,000 community institutions in over 99,000 villages and rural settlements across the country. These institutions are keen to link up with government and other actors to take forward their development priorities. The hopes and demands of these poor men and women across Pakistan need to be answered, and for this government’s commitment is essential.”
Courtesy www.dailytimes.com.pk