Arbitrary and autocratic steps only weaken institutions, economies and nations and never strengthen them
Dr Kamal Monnoo
Despite the love-hate-love story of Pakistan and Bangladesh spanning almost 78 years, one thing is certain: their economic destinies seem to be intertwined. Similar continuous challenges on mismanagement, corruption, flawed policies, exports, current account deficits, borderline exchange reserves and a toxic mix of power yielding politicians, bureaucracy and military failing who invariably fail to find a commonly agreeable governance formula, in turn time and again leading to a commonly prevalent phenomenon: “uncertainty.”
In Bangladesh, the previous government was increasingly autocratic and centralised a lot of power, and then the revolution came, led by students who weren’t politicians or administrators. Ever since, in forming the ensuing interim government, Dr Yunus has tried to appoint people with significant background and skills to advisory and/or decisions making positions, but such set-ups regardless of their quality have a limited shelf life and sooner or later need to make way for the political forces that actually command popularity and have their roots in the people. For example, in Bangladesh’s case, the current governor of the central bank spent most of his entire career at the IMF, which prepared him well for this position. A respected economics professor from Dhaka University took charge of the planning ministry. This method of appointing people, based on personal knowledge and connections, is a way of ensuring that civil servants are trustworthy and somewhat apolitical. But already issues are surfacing as such puritans simply could not appoint enough like-minded people to run a complex country of 175 million people, thereby slowing down the process of getting the ordinary business of government and of people getting done, which in many ways has made the life of the common man even more difficult than before. With genuine politics missing, it appears that this unusual team of decision-makers have left a leadership vacuum that, as time passes, is bound to add more uncertainty; something the economists so dreadfully fear! The situation in Pakistan, ironically, also seems not too different. A hybrid model was hastily assembled to address a fastcrumbling economic structure under the Khan government with a clear danger of imminent default. Though some visible level of macroeconomic stability appears to have been successfully achieved, courtesy of an IMF straitjacket, the disconnect with the people in the process is now quite visible and growing. What leaders often forget is that real success is not self-defined, but one that is recognised by the people. Public frustration is brewing to a boiling point with closing businesses, shrinking disposable incomes and dwindling employment opportunities, resembling a pressure cooker environment that does not allow steam to vent its way – dangerously bottled up to say the least. To exacerbate the situation, the lack of sensitivity on the part of the government functionaries has been baffling through repeated exercises of self-aggrandisement, pay and perks increases and in assuming draconian powers sans accountability. Also, there seems to be a sort of maze that leaves one confused about whom to believe, the government that is claiming an amazing turnaround story or the external data that puts Pakistan’s poverty figure climbing to almost 45% and points to a beeline of foreign investors rushing to exit the country! In any event, like Bangladesh , the anxiety and uncertainty are increasing by the day, and solutions may not lie any more in carrying more of the same.
In Bangladesh, immediately after the revolution, ordinary citizens experienced some breakdown in law and order. Historically, as in many other developing countries, there has always been an element of corruption, extortion and rent seeking by way of partnering with the people in power. Allegedly, under the old regime, the government protected street thugs who extracted from businesses, who in turn helped it remain in power. This is all extra-legal, but it created a kind of equilibrium under which business owners knew who they needed to keep happy. At least the “rules of the game” were clear to all participants. Today, things practically have not changed, but the clarity is absent. The mixed model has different power centres, and often the mixed signals from different quarters add to the uncertainty instead of reducing it. Another problem is that historically, regimes have used the police to try to put down dissent, meaning over the years the Bangladeshi police has lost its credibility and trust, and perhaps now fear retribution themselves, if things go out of hand. This also means that the power pendulum has shifted further away from the political parties, which is creating intra-party self-doubts among each party’s leadership & workers on its own future as a sustainable institution to successfully jockey for power. Unless this is addressed quickly by Dr Yunas and his team, it could be a recipe for disaster, because it could push the country towards factionalism and deeper divides along different lines. Now, replace the word Bangladesh with Pakistan, and all this could easily depict the scenario that we have here. Arbitrary and autocratic steps only weaken institutions, economies and nations and never strengthen them – who would know this better than Pakistanis and Bangladeshis themselves!
Lastly, while these unnatural, professional, hybrid or ad-hoc models – call them what you like – are often formed with good intentions and to rescue economies or countries from the socalled precipice of disaster, the repeated mistake they make is that they take it upon themselves to implement a comprehensive Change agenda for which they are neither equipped nor mandated. It seems Dr Yunas has fallen into the same trap to fix long-standing deeper issues and to bring out sustainable changes in the way the country is governed or the economy operates. Change Management is a science that requires competent cum relevant professionals to undertake it. Additionally, it takes time, since it cannot be rushed and requires an umbrella that the people trust and are willing to sacrifice for, if and when required. Neither of these pre-requisites can be attributed to such models. So, naturally it would be advisable for Dr Yunas and for his team to not further pursue such deeper underlying changes and rather stick to transparently handing power to the rightful political claimants while ensuring some firewalls that restrain them from abusing power at least in the near-term – trust or popularity can be short lived and goodwill is not an indefinite asset. Regrettably, here also in Pakistan we seem to be facing a similar dilemma, albeit of a more serious nature, because the reforms or the change agenda being brought about not only belies sense or any logic, but also because it entails coercion and is being brought about by people who arguable neither have the right credentials nor the specific experience cum qualifications to bring about the kind of cultural and behavioural changes that are being demanded in a matter of days rather than years. One can only hope that things soon improve and move in a clear direction, removing the current uncertain situations, both in Pakistan and Bangladesh. It really does not matter, though in who takes the lead, because if economic history is anything to go by, the other will quickly follow suit.
The writer is an entrepreneur and economic analyst. Email: kamal.monnoo@ gmail.com
