By Mohammad Ashraf Chaudhry
Pittsburg , CA
First of all, let us admit that all the problems listed in the title have two things in common: they are made-made; and they are interlinked. Starting on these premises, we proceed direct to the solutions through examples.
In December, 2008, when I went to interview Shahbaz Sharif, I asked him to do one thing: invite Jeffrey Sachs, the famous Columbian University Professor who looks at poverty in the world not as a social evil, but clinically, treating it as a disease, needing an urgent and practical cure, and who offers an integrated set of solutions.
And if possible, read his book, “The End of Poverty – Economic Possibilities for Our Time”. Prof. Jeffrey Sachs envisions ending poverty from the world by the year 2025. He just does not talk; he offers some down-to-earth workable solutions to the problems infesting the poor, Third World countries.
Prof. Jeffrey Sachs practically worked and helped the people of countries like Poland, Bolivia, Russia, India, China, Malawi, and Ethiopia, and his success in Poland, India, and Malawi is a text-book case.
Currently, Pakistan faces three major problems.
There is acute shortage of energy, which is also related to water and to the health problem of the people there.
Some do not like Jeffrey Sachs’ shocking revelations when he says, “Newspapers should, (but don’t) report every morning, ‘More than 20,000 people perished yesterday of extreme poverty’ ”. He believes that there should be a “comprehensive package of economic reforms that attempts to fix all problems simultaneously and quickly”. Some call it absurd, but the fact of the matter is that this is what the poor want. They do not want sermons or speeches; they want simple, quick and workable solutions.
Second: and again it is not very much liked by the West, “The West should always give a lot of money to support these packages”. Poor are poor, not because, they are lazy by nature or that they are in love with poverty; they are poor because they are caught up in a poverty trap”.
His cry that the world economy has run into a brick wall fell flat on the world conscience. Nations that do not think ahead suffer. He names four factors that often result in the poverty of people in the developing countries:
- Chronically low productivity of farmers caused by their inability to pay for seeds, fertilizers and irrigation.
- Misguided policies, followed in the US and the European countries to convert food crops, like corn into bio-fuels, such ethanol;
- A climate change, such as in Australia and Europe, resulting in global low production in grain in 2005 and 2006;
- A growing demand for food and feed grains due to a swelling increase in the populations and incomes.
What worked in Malawi, a famine-prone country in southern Africa, can work in Pakistan as well and in the third world countries. First: help the farmers to procure fertilizers and high-yield seeds by subsidizing the cost. It is a benign investment, and not wastage of money. Malawi’s harvest doubled after just one year.
Second: Europe and the US abandon their policies of subsidizing the conversion of food into bio-fuels. For example, the US gives, according to him, 51C per gal. of ethanol to divert corn from the food and feed-grain supply. It is just not right to “put the world’s dinner into the gas tank”.
Third: “We need to weatherproof the world’s crops as soon and as effectively as possible”, and by this he means conserve every drop of water by even creating farm ponds, “Chappars”, let alone go waste the fresh, sweet water of the rivers into the Arabian Sea, as Pakistan and its politicians are letting it happen.
By conserving water, and distributing it in a just and equitable manner among the farmers of Pakistan, and not letting the big and powerful vaderas and landlords of Sindh and Punjab, steal it; and by providing high-yield seeds to the farmers along with fertilizers on very cheap rates, the nation can have a boom of prosperity within a period of two years. No poor, at least, would feel constrained to sell his children because of hunger; and no parents would feel as helpless as to commit a joint suicide. Last month alone more than 229 people committed suicide in Pakistan.
ENERGY CRISIS: This is the main devil that has brought the spinning wheel of the entire country to a standstill. And it is related to water. There are two examples that can be cited for emulation. One is that of China and the other is that of Algeria.
One reason that slowed or halted the new investment made by the multinational companies around the world was the energy crisis. Pakistan got impacted by these problems on two scores. The security and law and order issue and second the erratic supply of energy. China that had been over the last many years a text book case of economic progress also felt the energy crunch. The new high oil prices further created the urgency to find alternative sources of energy.
China in 2007 went into the wind energy field in a big way. Its wind equipment manufacturing sector became the most lucrative areas of investment. In 2007, China set its target of installing 5 gigawatts of wind power capacity by the year 2010, and 30 gigawatts by the end of 2020. But such had been the results and foreign response that as was reported by the RightSite Team in 2009 “given the current place of development, China is on track to reach its 2020 goal of 30 gigawatts by the end of 2010”, ten years ahead of the stipulated time. The shortfall of energy in Pakistan had been of about 5 gigawatts, or 5,000 megawatts. And look at the availability of sunshine and wind and water in Pakistan. Sindh’s new assertion that it opposes a major dam on Sindh river because there is already shortage of water in the rivers is silly and is based on opposition for the sake of opposition. Vadera’s own interest is involved in it.
In monetary terms, this wind power has attracted over RMB340 billion in foreign investments in 2008 to China. Chinese government announced commendable incentives that resulted in further demand for wind power equipment manufactured in China. It decreased 50% VAT rate for electricity generated by wind as far back as in 2001. Now the developed countries like Netherlands, the United Kingdom and Spain have become the major importers of wind power equipment from China.
Tianjin Port alone has exported a total of 166 wind turbine units from January to September – a 120% increase compared to last year’s, which being 2007. China exported 10,398 wind turbine units in 2008, generating revenues of US $211 million in the process.
We know necessity often becomes the mother of inventions; unfortunately, Pakistan converts every necessity into a liability.
In the back streets of Pakistan in Rawalpindi, I have seen hard-working, home-trained electricians making UPS devices to counter the energy load-shedding problem, and selling it at less than Rs. 3,000. I saw motor mechanics, making such obsolete brand cars as Morris Minor of the 1967s run as taxis on the Pakistani roads; at most crossings, I saw small shops repairing such un-reparable equipments as meat-choppers and milk-shake machines. Young school and college boys know a hundred and one uses of a cellular phone. Nothing gets thrown away in Pakistan, not even the soiled rags on the dung heaps. Only the leadership in Pakistan never stops cheating the nation, as it does nothing to put the thriving and enterprising people of Pakistan to a good, positive use. They are neither lazy nor inept.
Nor is Pakistan situated in a Sahara or in Africa. They are starving for work and there is no work for them. China turned the tables on energy crunch. India is doing it now. Singapore, Hong Kong, Taiwan, South Korea and Vietnam did that many years ago. We are still embroiled in the process of learning the right way to perform ablution as if God sent the Five Prayers for the sake of learning of how to make the ablution.
SECOND SOURCE OF ENERGY: THE SUNSHINE
Two things in Pakistan are in great abundance: the wind and the sunshine. They talk of coal reservoirs as well. Politicians have politicized the water of the rivers and it is a highly disputed matter now. Those who talk of dams are named as dam-fools. The present class of leadership in Sindh, in the Center and in the newly named province of Pukhtunwa is not even willing to talk about Kalabagh or even other dams. Afghanistan is talking of building a dam on the Kabul river. I have no idea how that would be taken by the ANP stalwarts.
Algeria offers another solid example of how to look for the alternative sources of energy. Algeria’s vision has enticed, or rather bamboozled the solar energy planners. It has erected huge solar panels stretching out over vast swaths of the Sahara desert, soaking up sun to generate clean, green power”. Its first plant would be ready in 2010 and it would be a hybrid plant, using both the gas and steam turbines having a solar thermal input. Algeria’s “longer term goal is to export 6,000 megawatts of solar generated power to Europe by 2020, about a tenth of current electricity consumption in Germany” , wrote the Associated Press in August 2007. But that was three years ago.
“Our potential in thermal solar power is four times the world’s energy consumption so you can have all the ambitions you want with that”, said Tewfik Hasni, managing director of New Energy Algeria, or NEAL. With a population of 33 million Algeria remains heavily dependent on oil and gas exports which earn it about $54 billion in a year. Not so in the case of Pakistan. Pakistan on the contrary has a population five times greater than that of Algeria, 167 million, and is heavily dependent on oil imports. Before Algeria’s oil resources exhaust, it has succeeded in discovering an unending and unlimited source of energy, the God-given sunshine. Not so in Pakistan. Even the deserts of Sindh and Baluchistan and of southern Punjab will become disputed like the waters of the five rivers once the efforts are initiated to tape it.
MONEY: The title page of the Time magazine of June, 2010 is about bankruptcy. California narrowly escaped bankruptcy last year in February, 2009. About 46 of the 50 states in America are insolvent and could be filing Chapter 9 bankruptcy proceedings in the next two years, says Ellen Brown in his article “Bank On It: How Cash-Starved States can Create Their own Credit”.
An exception is that of North Dakota. As says Michigan management consultant, Charles Fleetham, “North Dakota is a sparsely populated state of less than 700,000, known for cold weather, isolated farmers and a hit movie – Fargo. Yet, for some reason it defies the real estate cliché of location, location, location. Since 2000, the State’s GNP has grown 56%, personal income has grown 43%, and wages have grown 34%. This year the state has a budget surplus of $1.2 billion!”.
The explanation is simple: it has its own bank. All money goes into it and all bills get paid out of it. Wall Street stays out of it. So the formula is simple. Be it North Dakota or Pakistan, unless fiscal policies relate to the local conditions and unless austerity measures and the motto of self-dependence are not followed, no reams of borrowed money can rescue a state or the country.
Prof. William Easterly while commenting on Jaffrey Sachs’ boom, “The End of Poverty”, is partially correct when he differs with the solutions offered by Jeffrey, and says that ending the poverty is a lengthy process. Sachs says, “Success in ending the poverty trap will be much easier than it appears”. Prof. Easterly raises the right question. “Why the previous $2.3 trillion didn’t reach the poor so that the next $2.3 trillion does. In fact, ending poverty is not easy at all”.
Should we despair? Certainly not. But Prof. Easterly raises those issues that Prof. Sachs in his solutions tends to deal with somewhat lightly, especially in the poverty and corruption stricken countries. Poverty researchers have pointed out rightly to those areas. Some of those are: the toxic politics of those countries; bad history as they were ruled by the inept and greedy colonists; ethnic and regional conflicts (such as they are emerging to the forefront in Pakistan these days); elites’ manipulations of politics and institution (no change in Pakistan can take place unless some Ataturk first deals with the feudal lords, vaderas, sardars, khans and Chaudhris who are inside and outside the parliament); official corruption; dysfunctional public services, malevolent police forces and armies; the difficulty of honoring contracts and property rights; unaccountable and excessively bureaucratic donors and many other issues.
There are some more related issues as well: the World Bank studies in Guinea, Cameroon, Uganda and Tanzania revealed that about 30 to 70 percent of government drugs disappeared into the black market rather than reaching the patients. The Benazir Welfare Scheme, and the Tandoor Scheme in Punjab, are the two recent examples of corruption and wrong approach to eradicate poverty. One cause of famine in Malawi was its corrupt officials who sold off its strategic grain reserves as happened in Pakistan last year with relation to sugar and wheat, or a few years when the corrupt imported defective insecticides and ruined a whole cotton crop; or as happened in Ethiopia where rulers favored their own minority – Tigrean ethnic group. (As they are doing in Pakistan. Jobs and funds, whether they exist or not, are being given to the party workers; to the ethnic groups etc.)
Seventy-five percent solutions to Pakistan’s problems lie within Pakistan. Unless the house is put to order first; unless strict measures of accountability are introduced without any waste of time and are applied ruthlessly, I repeat, ruthlessly and mercilessly, but in a just and transparent manner, all programs are bound to end in failure. Sachs sounds plausible when he says, “Mahatma Gandhi and Martin Luther King, Jr. did not wait for the rich and powerful to come to their rescue. … the poor cannot wait for the rich to issue the call to justice. The Rich, represented through G8 will listen only if the poor themselves raise their voice. But as the saying is: pockets with holes do not hold anything. Corruption must end first. Pakistan’s Constitution is not so ill-worded that anybody should read his own interpretation in it as is happening these days.
Let the rule of law prevail; let the army support the Chief Justice openly as it did in Bangladesh that no compromise on the issue of accountability will be compromised; let the politicians get the message in a loud and clear manner that funny, contradictory, meaningless and highly provocative political statements could have dire consequences and could cost them dearly; and let the people engaged in ethnic and target killings and in other activities of terrorism get a final, clear message. They can live in Pakistan, but they have to learn to live in peace and with others by abiding to the laws of the land.