In every loss there is an opportunity. Every time General Motors loses a customer Toyota gains one. ~ Chairman, Toyota, 1978. Surely some kid in China at the time was paying attention Today, when the world has recently witnessed the worst financial meltdown ever and is probably still going through one of its worst depressions since the 30s, China seems to be sitting pretty - Growth continues to border in double digits, exports keep climbing and believe it or not the manufacturing in China (yes, in China) is facing labor shortage Only last week when talking to our European partners, I was told by their CEO China operations that their textile plant, M/s Sang Cheong, in mainland China was running at 50% capacity only because they cannot find workers. In fact, the plant next doors to theirs, a large toy making factory, could never really reopen after the Chinese New Year holidays (traditionally 2-3 weeks) in January, as the workers never returned back because they easily managed to find work near their homes and so obviously stayed behind. Sang Cheong happens to be located in one of the most developed industrial estates of China, very close to Hong Kong from where this huge textile plant was shifted to mainland China back in 1998, and more importantly the wage rates in that area are amongst the highest in the country. While the Western corporations continue to struggle in the recent crisis and consumers look for better value for money, China being ideally placed has maximized this opportunity and gained tremendously as a result. Their present Premier, Wen Jiabao, the kid in 1978 was the one who was listening intently and has just publicly admitted to having consciously put the Chinese economy into an over-drive while everyone else around the world was busy putting the breaks on. Needless to say, the results on his visionary approach speak for themselves The sad thing, however, in all this is that while the opportunity for Pakistan was no different it failed to take any advantage - Same old story: lack of visionary leadership and narrowly focused policies failing to look at the larger picture. With Pakistans debt climbing at an alarming rate over the last 3 years and with the leaderships worsening addiction to borrowing per say (Greece immediately comes to mind), the Finance Ministers primary job has become that of a fund raiser. Busy 24/7 in IFC (International Finance Corporations) hopping, perhaps he needs a partner or an additional finance minister who can alternatively provide the country with the much needed economic vision and direction. It is all very well in the short term to raise existing taxes, introduce new ones and increase government utilities prices to generate extra revenue, but unless such measures are adopted with prudence and fairness, their long term effects can turn out to be disastrous. For example, in a country like ours that is already brewing with public anger and youth frustration, introduction of ground level taxes can be potentially counter productive. When it comes to levying of fresh or enhanced taxes, reciprocity, perception and confidence in the state and its tax collecting mechanism cum machinery tend to play a very important role in determining implementation success from failure - Sadly, as things stand today, just a cursory survey at any little street corner or a Tea stall of the country will clearly reveal the current trust deficit of the government amongst the general public This does not by any chance mean that the government should not be looking at raising revenue collection through taxes, but what it means is that given the present ground realities and the governments own inadequacies, the whole process needs to be thought through and implemented gradually after taking due steps to first address the tax payers concerns. In the meantime, the government will be well advised to search its closet to dig out the revenue enhancing schemes that worked well in the past and use them instead to boost its revenue collection. Some that off hand come to mind are, the self assessment scheme, whitening offers, immunity through significantly enhanced tax payment over the previous year, one time exemption for entering the tax net, etc.. Pakistans traditional weak link has always been its micro-management failures. Money losing State Enterprises are like lumps that can either be converted into muscles of strength or just allowed to turn into ulcers that quietly bleed the economy to death. Privatization may not always be the ideal solution, because some time security lies in retaining the family silver and not in selling it. Very much touted otherwise, but in developing or under-developed countries, we often witness that the classical argument in favor of privatization of selling a public asset in order to bring it to a more productive use does not generally comes good. If this recent global financial meltdown has taught us anything, it is the value of holding on to ones traditional assets and for the governments to in-turn adopt a proactive approach in installing professional & autonomous management structures that can help resurrect such institutions which otherwise were considered doomed. Likewise, at home, if ever there was an urgency to install competent professional managements in State Run Enterprises in order to turn them around, then that time is now. Finally, to the lesson we ought to learn from the Greece debacle: In the economic world, nothing succeeds in isolation and for any economy to be successful all the different components of its economic engine have to work in tandem and run efficiently in their respective places. The relatively boom time (post 9/11) enjoyed in Pakistan for about 5-6 years helped to disguise some sentiments that were never far below the surface: ultra-extremism, including the violent sort which spills over into terrorism. Such elements are now being unleashed. History tells us that if not controlled in a timely manner, such elements before one realizes spawn a new generation of self-styled Robin Hoods practicing both political and criminal violence - The situation in North of Pakistan appears to be not much different Also, invariably on the economic front the losses are more evident in shape of loss in a countrys competitiveness to produce and in its inability to productively use its human and natural assets. Like in Greece there is also now well-founded suspicion in Pakistan that our light-fingered bureaucrats and greedy politicians, the very people who are considered to be responsible for most of our economic woes, should be held to account but wont be. Either in fear or in hope, many Pakistanis detect a breakdown of the present political system, in which the two main political groups continue to lose face as both are increasingly perceived to aid the ills of patronage and incompetence. The trouble is that instead of seeing any sincere efforts from them towards improving governance, what we instead get is the constant 'save democracy rhetoric and in that each leader perhaps comparing himself to Odysseus making his heroic struggle to save the system, values and the nation itself. What they dont remember is that once Odysseus failed to inspire his men, He not only had a miserable run, he also lost all his companions and supporters, and ultimately washed up on Ithaca without any clothes on. (