planned economies and the overriding objective was the transformation to capitalist market economies rather than the fostering of economic growth and welfare. But by 2000, the EBRD was reporting that the effects of the initial starting point in each transition economy on the reform process had faded. Although the foundations had been laid for a functioning market economy through sustained liberalization, comprehensive privatization, openness to international trade and investment, and the establishment of democratic political systems there remained institutional challenges. Liberalized markets were not necessarily competitive and political freedom had not prevented powerful private interests from exercising undue influence. Ten years on, in the Transition Report for 2010, the EBRD was still finding that the quality of market-enabling institutions continued to fall short of what was necessary for well-functioning market economies. Growth in the transition economies had been driven by trade integration into the world economy with "impressive" export performance, and by "rapid capital inflows and a credit boom". But such growth had proved volatile and the EBRD considered that governments in the transition economies should foster the development of domestic capital markets and improve the business environment, including financial institutions, real estate markets and the energy, transport and communications infrastructure. The EBRD expressed concerns about regulatory independence and enforcement, price setting, and the market power of incumbent infrastructure operators. Income inequality as measured by the Gini coefficient rose significantly in the transition economies between 1987 and 1988 and the mid-1990s. Poverty re-emerged with between 20 and 50 percent of people living below the national poverty line in the transition economies. The UN Development Programme calculated that overall poverty in Eastern Europe and the CIS increased from 4 percent of the population in 1988 to 32 percent by 1994, or from 14 million people to 119 million. Unemployment and rates of economic inactivity were still high in the late 1990s according to survey data. By 2007, the year before the global financial crisis hit, the index for GDP had reached 112 compared to 100 in 1989 for the transition economies. In other words, it took nearly 20 years to restore the level of output that had existed prior to the transition. The index of economic output (GDP) in the countries of Central and Eastern Europe was 151 in 2007; for the Balkans/ South-eastern Europe the index was 111, and for the Commonwealth of Independent States and Mongolia it was 102.