Pakistan: Country Partnership Strategy FY 2010-2013
August 6, 2010 - The new Country Partnership Strategy (CPS) reflects lessons learned from the Bank’s past engagement in Pakistan. In particular, the need to adapt to a rapidly changing political and security environment highlights the need for flexibility. In addition, given Pakistan’s unique development and geopolitical challenges, enhanced partnership arrangements are critical.
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Executive Summary
The World Bank Group’s support to Pakistan will be organized around four pillars:
Improving economic governance;
Improving human development and social protection;
Improving infrastructure to support growth; and
Improving security and reducing the risk of conflict.
Pakistan has been bestowed with extraordinarily important strategic endowments and great development potential. To make headway in realizing its development potential, Pakistan must overcome the obstacles to its ability to sustain high economic growth rates, to manage conflict and to improve the social indicators and capacity of its population.
Pakistan has been undergoing remarkable political and constitutional changes over the last two years. Civil society and the judiciary have been playing a more active and independent role. Free and fair elections were held and vigorously contested by largely unfettered political parties with competing manifestos. The recent political developments present a strong political legitimacy and a window of opportunity for wide ranging reforms.
Key Development Challenges and Government's Poverty Reduction Strategy
Pakistan needs to address a number of critical challenges in order to grow faster.
Weak revenue mobilization.
Improving the level, composition and efficiency of public expenditure.
Shortages of reliable infrastructure.
Conflict and insecurity.
Providing employment for a young, growing and increasingly urbanized population.
Governance challenges.
The Government's strategy recognizes that in order to bring back the country on a path of sustained growth, creating jobs, and reducing poverty, a prolonged period of macroeconomic stability, financial discipline and sound policies is required.
The support of the Bank is structured to be flexible in the face of considerable uncertainty and to ensure that its level is closely tied to its likely effectiveness.
Looking forward, despite the risky operational environment, the demand for Bank Group services, both from the Government and other development partners remains strong. Hence the challenge will be to creatively manage security risks in order to deliver the WBG program.
Several key risks for the implementation of the CPS surfaced during the last Country Assistance Strategy period (FY2006-09). These risks included macroeconomic and security risks, and exogenous shocks. All these risks materialized in ways that had significant impact on the CAS and World Bank program.
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