A Spoonful of Sugar

By , 17 January, 2010, No Comment

I’ve got a piece in this week’s edition of Forbes on the real crisis in Pakistan—the systemic failures of government, particularly on economic issues. My case study is the mismanagement of the nation’s sugar supply:

The sugar crisis has its roots in the fragmentation of Pakistan’s sugar sector. Growers, millers, wholesale distributors and retailers each have their own regulatory overlords offering protectionist perks and their own cartels to defend such gains. Though this structure goes back to the 1950s, recent policy decisions and the worldwide spike in prices of commodities like sugar have aggravated its effects.

…Economic problems provide rallying cries for opponents like Sharif and radical insurgents eager to bring down the government, while a weak and dysfunctional state contributes to economic distress. In the case of sugar, whose consumption in Pakistan is approaching developed-country levels, the danger is acute: In 1969 a sugar shortage helped bring down the rule of military dictator Ayub Khan.

Read the piece in full (and comment!) here.

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