It is an honour for me as President of the Pakistan Society of Development Economists to welcome you to the 14th Annual General Meeting and Conference of th~ Society. As we prepare to enter the new millennium, we find ourselves at a crucial moment in history. It is time to take stock of our past achievements and to assess the new challenges. To deal with the future would require not only thorough knowledge of the evolving nature of development thinking but also a good sense of the policy choices available to a country in its national, international and regional position. What are the main challenges that require our urgent attention? A few words are in order at the very outset about Pakistan’s current difficult economic situation. The slow-down in export expansion, capital inflows and foreign direct investment was an expected consequence of the imposition of sanctions. The pessimistic assessment of Pakistan’s prospects is based largely on the recent negative trends of these economic parameters. The optimists are of the view that Pakistan has survived the imposition of sanctions rather well. Economic growth has remained positive and inflation has been kept under reasonable control. The optimists further maintain that Pakistan’s current economic situation is no worse than that of the East Asian countries when. they started their economic climb and engineered major institutional and policy changes. Lessons from the initial years of the East Asian miracle clearly show that development is decidedly possible no matter what adverse initial conditions obtain in any developing country. Sustained, rapid and equitable growth is possible through the implementation of wide-ranging social and economic reforms. Lessons from’the recentEast Asian Crises are also before us-guiding us on what not to do and how best to protect ourselves in these rapidly changing times.