PAKISTAN stands at a critical juncture in its development journey. With a population of over 240 million, nearly two-thirds under the age of 30, the country faces a looming jobs gap that could define its economic trajectory for decades to come. Over the next decade, 3m Pakistanis, including 2m young people, will enter the workforce each year, seeking opportunities to build better lives. Without a clear path to work, many will face unemployment and worsening poverty, inequality and instability.

The World Bank Group recognises that creating more and better jobs is not just a development priority, it is essential for global growth and stability. That is why job creation is the WBG`s number one priority, and why the International Finance Corporation (IFC), as the private sector arm of the WBG, is committed to addressing Pakistan`s job challenge.

Jobs challenge in Pakistan: Pakistan`s economic landscape is marked by significant challenges. The country ranks 164th out of 193 nations in the UN`s Human Development Index, which provides a broad picture of life expectancy, education, and income. Female labour force participation stands at just 25 per cent, among the lowest in South Asia, with more than 40m women out of the labor force.

Meanwhile, data from the National Financial Inclusion Strategy shows that as of December 2023, only 64pc of the population and 42pc of women had access to formal financial services and products.

According to the World Bank Macro Poverty Outlook Report from April, poverty levels remain high, with 42pc of the population living below the lower middleincome poverty line of $3.65 per day.

Although poverty is projected to decline slightly to 41pc by 2027, slower wage growth, high population growth and limited job opportunities restrict progress.

The informal economy, which accounts for an estimated 40pc of economic activity and 70pc of jobs, compounds these challenges.

Role of the private sector: Addressing these challenges requires a coordinated public-private response. While public-sector investments are key to setting the preconditions for job creation, it is the private sector that drives growth and creates most jobs. Mobilising private capital is essential to unlock Pakistan`s economic potential, strengthen businesses and create new job opportunities.

IFC`s work in Pakistan demonstrates the transformative impact of private capital mobilisation. Over the past three years, IFC has tripled its investments, supporting over 60,000 jobs. In FY24 alone, IFC invested $2.1 billion a 22pc increase onthe previous year supporting 40,000 jobs, including more than 8,600 for women.

These investments are not just numbers; they represent real opportunities for people to thrive.

World Bank Group`s strategy: The WBG is confronting the global jobs challenge with a three-part strategy that combines public and private sector expertise. This approach is also embedded in our 10-year Country Partnership Framework for Pakistan, which prioritises key sectors with the greatest potential to drive job creation and growth.

Establishing preconditions for jobs: The WBG invests in infrastructure, health and education to lay the groundwork for economic growth improving human capital, enhancing productivity and enabling workers to find jobs. In Pakistan, IFC is actively exploring IT upskilling initiatives to create high-quality, flexible job opportunities.

Creating enabling environments: Through its Knowledge Bank, the WBG supports countries in developing regulatory and policy environments that allow businesses and entrepreneurs to succeed. InPakistan, this means fostering smart regulations and promoting financial inclusion.

Mobilising private capital: IFC plays a key role in attracting private investment to high-growth sectors that drive job creation. Its innovative $4bn MSME Finance Platform expands financing for micro, small and medium enterprises (MSMEs)through debt, guarantees and risk-sharing, helping them grow and create jobs.

Building a prosperous future: Job creation is not just an economic imperative, it is a social and political one. Quality employment promotes stability, reduces migration and prevents poverty. Pakistan`s jobs challenge is significant, but not insurmountable. With urgent, deliberate action, the country can unlock its economic potential and create opportunities for millions of workers.

At IFC, we are proud to support this effort. Together, we can help turn Pakistan`s young population into its greatest asset and drive the country towards a brighter, more prosperous future. • The wnter is the Intemational Finance Corporation`s regional director for the Middle East, Pakistan and Afghanistan.