Daily Times Editorial 6 June 2020
3m job loses likely
Getting the economy back on track, especially creating millions of jobs, is clearly going to require some out of the box thinking on the part of the government. According to a letter from the finance ministry to the Senate, approximately three million jobs will be lost in the country in the “initial round” of the coronavirus outbreak. This is one of those news items whose impact is not felt any less even though it is pretty much written on the wall. With the economy shut down for more than a fortnight, and many small business already closed down with no hope of revival, the job market has indeed suffered endlessly because of the pandemic. And let’s not forget that the going wasn’t exactly easy before the virus came. Low growth, high inflation and rising unemployment was already pushing jobs and businesses to the limit. And now there’s the reality of the global recession to deal with as well.
This is by no means a normal moment in the history of the world. As the international media is pointing out, we are at a point when most, if not all, economies of the world are near or below zero percent growth. It is precisely such crises that effectively eat up weak economies with chronic low growth and high debt; especially if they have very large populations, with a frightening number of people living below the poverty line. The state bank tried to calm nerves the other day, implying that we might have it easier than most countries going forward. But the governor should also have broken down the facts a little bit. The revenue stream is badly broken. Tax and export earnings, not to mention remittances, are all declining sharply. And authorities are struggling to get the IMF program back on track. There is the prospect of limited debt moratorium from G20 countries, but very little beyond that.
The finance ministry has very rightly noted that the expected 3m job losses is only an initial round figure. And since there’s still no end in sight as far as the fight against the coronavirus goes, there’s no telling how many more rounds might await us. Rather than take comfort in the fact that some of our numbers might be a little better than some other countries, the government is advised to quickly put an action plan in place. But with all sorts of income compromised, at least for the foreseeable future, it will be interesting to see what they fall back on other than more loans. *
PSM lesson for PTI
There’s little that can be done with run down state enterprises that hemorrhage billions of rupees every year and are and endless burden on the taxpayer than wrap them up for good and, better yet, fetch whatever small price they can on the market while they still have a name. And this argument should, in normal circumstances, also hold true in the case of the PSM (Pakistan Steel Mills). But then that also begs the obvious question: why did PTI leaders go out of their way and make the case for its revival, and large claims about never letting it get privatised, when they say on the other side of the aisle? For there is no shortage of videos going viral, showing passionate speeches by Imran Khan, Asad Umar, and other PTI leaders about how deeply they cared about PSM as well as the thousands of employees that worked there. What now of promises that should PTI, when in power, dismiss the workers some PTI leaders would stand with them instead of the party?
And it’s not as if privatisation is a straight forward affair, especially when it comes to Pakistan’s public sector enterprises. Putting them up for sale in the shape that most of them are in makes very little sense, since it would amount to giving away the family silver for a nickel. And doing what the present government is considering to do is hardly any smarter. If you can turn it around and make it good enough to sell, why can’t you get it back in shape and keep running it? It is because of the weight of just such arguments that this paper has never backed any government’s wild promises in favour of large scale privatisation.
PTI has gone back on so many of its promises in its two years in power that it seems to have become quite comfortable with not keeping its word. It can’t be that nobody in the party had any idea of how badly PSM was really doing before winning the election. If the general public did, then they must have also. They made similar excuses about the economy; that they simply did not know how bad things were. Could it really be that none of them watched the news before coming to power? There is a valuable lesson in the PSM drama of the last few years for PTI, just like there have been lessons every time it chose to take a U-turn on an important policy position. Its leaders must, finally, learn to weigh their words before making tall claims. Such issues usually become big problems when time for the next election arrives.