Investing for Growth and Poverty Reduction: Institutions and People

I am delighted to have this opportunity to return to Pakistan. I visited this country often in the 1980s, and found it to be a place of enormous possibility. At that time, the macroeconomic aggregates suggested that Pakistan was doing well. The economy had grown strongly throughout the 1960s and 1970s, with growth rates averaging 6.8 percent in the 1960s and 4.5 percent in the 1970s. And even from 1980-85, Pakistan’s growth rate averaged a very respectable 6.7 percent (Figure 1). Poverty declined sharply during this period.