IMF agrees to lend $6bn to Pakistan: sources

[Ryuzaki]

According to Pak news show discussion, money lent by China and Saudi has already been blown away in a matter of weeks

 

[VCheng]

None of the previous governments have had the courage to do so. Will Mr Khan?

The short answer: No.

 

[HariPrasad]

Congratulations.

 

[ziaulislam]

According to Pak news show discussion, money lent by China and Saudi has already been blown away in a matter of weeks

Money of these countries were blown away to keep the country floating for 6 months

Money was also blown to pay back old loans
The Chinese package was blown before the govt came in power while saudi package last part was recived just recently while UAE package just started.

Oil defer package which size is as big as abive hasnt even started yet!!

Nor is the new Chinese package(old 2b$ support was given in june

According to Pak news show discussion, money lent by China and Saudi has already been blown away in a matter of weeks

Stop watching Pakistan news most if its fake news

We have evolved from true news-true analysis to true news-biased anaylsis and now to false news no shame situation

 

[VCheng]

More pain for the people to come, all in the spirit of sacrifice, of course, depending on what PMIK decides:

https://www.dawn.com/news/1464544/leaning-on-the-imf-will-cost-govt-dearly

Pakistan has to commit to a further fiscal adjustment of around 2.5 per cent of GDP along with ‘deep-rooted’ and wide-ranging structural reforms to secure a bailout from the International Monetary Fund (IMF) despite top-level political interventions, according to sources.

This adjustment will have to be supported by a further increase in electricity and gas rates as well as reining in the bleeding in public-sector entities to address the quasi-fiscal deficit in the system. The combined adjustment over the next two years can go beyond 3.5pc of GDP (over Rs1.4 trillion).

...............

More significantly, the rupee has to get close to its real effective exchange rate to come to terms with the IMF.

There are also indications about the revival of discussions for the introduction of a universal value-added tax (VAT) to replace the GST for an integrated coverage of goods and services across the country for which the provinces will have to show consent. All past efforts failed to reach a consensus on VAT or even the reformed-GST.

 

[AgNoStiC MuSliM]

More pain for the people to come,

What's your view, outside of the domestic political implications - necessary reforms?

 

[VCheng]

What's your view, outside of the domestic political implications - necessary reforms?

What the IMF is prescribing makes economic sense. The only problem the government has is the lack of political will to implement them. Whether they decide to go with another IMF program or not, devaluation, inflation and stagnation are likely outcomes, simply due to the costs of chronic mismanagement that must be paid back.

Within a year or two, it is likely that the PKR will exceed 150 to one USD, inflation approaching 15% and the people dealing with a stagnant job market and economic activity. It is going to be a cold economic winter until spring arrives proverbially.

Whether the government can actually implement the necessary reforms is doubtful, given that they has already been delayed by years and years, leaving little time in which to make up the shortfalls. The power sector with its mounting circular debt, the lack of reserves to finance imports, and increasing debt servicing and defense costs will continue to limit the maneuvering room available to PMIK.

On the bright side, PMIK has shown deft moves within the little space that he has left to maximize his advantages, energy prices remain low in international markets and the breathing room offered by Middle Eastern largess (despite the strings attached) does give some hope that Pakistan will be able to weather the next few years albeit with increasing economic hardship for the people.

 

[nahtanbob]

One of the best articles on IMF package that I have come across:

Quote

Good news? Yes. We need the package, not only because of the direct infusion of cash it will bring, but also because this will open up other borrowing opportunities from the open market. And yet, all this means nothing if we don’t get real about what we’ve got to do ourselves.

My worry is that if we keep the current tenor of public debate going, we won’t. As soon as we secure this deal, we are likely going to see the prime minister declare victory like he did after securing money from the UAE and Saudi Arabia. Lost here will be the fact that this money has taken us off the ventilator, nothing more. We are still sick and shall remain so if we don’t overhaul the structures of the economy.

The bottom line is as simple as it gets: we spend way more than we earn and there is nothing short of real and intense structural transformation of the economy that can bridge this gap sustainably. Previously, we behaved like an addict who continues to get an opiate under the promise that he’ll enter serious rehab. In reality, we have neither shown the intent nor seem to have had the capacity to bear the pain the process entails.

This is the only question we should be debating: are we ready for serious rehab, and if so, is everyone clear what all this will entail? If we are, we should be taking the discussion in a different direction: if there were no IMF, no bilateral benefactors, and no remittances, what would we have to do to bridge the revenue-expense gap? That’s the approach we need. If we adopt it, the rest is not rocket science and will follow. But for this, the prime minister would have to move the public narrative away from declaring victory to warning the public that what’s coming is going to hurt, but that it’s a pain we must endure for our long-term success.

None of the previous governments have had the courage to do so. Will Mr Khan?

Unquote

The writer is the author of Brokering Peace in Nuclear Environments: US Crisis Management in South Asia.

www.moeedyusuf.net

Published in Dawn, February 12th, 2019

Full article:
https://www.dawn.com/news/1463298/ready-for-reform

what can Mr Khan do ? It is not like pakistan can start exporting semiconductors now that he is the prime minister
it is the same old pakistan.

 

[Śakra]

what can Mr Khan do ? It is not like pakistan can start exporting semiconductors now that he is the prime minister
it is the same old pakistan.

They sure believe he is going to magically increase exports. They never ask exports of what? They dont have a large educated class, so IT is out of the question. They dont have a large technically trained class, so manufacturing is out of the question. RMG market is cornered by Bangladeshis (@Mage can tell you more), and agriculture is an unreliable market (fluctuates too much). So once again, what are they going to export?

 

[Republic]

Money of these countries were blown away to keep the country floating for 6 months

Money was also blown to pay back old loans
The Chinese package was blown before the govt came in power while saudi package last part was recived just recently while UAE package just started.

Oil defer package which size is as big as abive hasnt even started yet!!

Nor is the new Chinese package(old 2b$ support was given in june


Stop watching Pakistan news most if its fake news

We have evolved from true news-true analysis to true news-biased anaylsis and now to false news no shame situation

Then why to abuses only Indian news channels ??
They are all same........

 

[ziaulislam]

Then why to abuses only Indian news channels ??
They are all same........

Pakistan has free media. Most channels you think of are dubai based and not truly Pakistani
Infact, i dont see a single truely english channel/news paper in Pakistan

 

[VCheng]

They sure believe he is going to magically increase exports. They never ask exports of what? They dont have a large educated class, so IT is out of the question. They dont have a large technically trained class, so manufacturing is out of the question. RMG market is cornered by Bangladeshis (@Mage can tell you more), and agriculture is an unreliable market (fluctuates too much). So once again, what are they going to export?

Low skilled labor to the Middle East.

 

[RoadRunner401]

Congratulations to Pakistan for keeping IMF in business.

Wait the minute, Compared to the latest data available till September 2018 when the total debt of the Indian government stood at Rs 82,03,253 crore, the corresponding amount till June 2014 was Rs 54,90,763 crore, Indian Finance Ministry's data on government borrowings shows.

Mr @Skull and Bones, It seem Pakistan keeps IMF in business and India keeps all the financial institutions of the world in business

 

[Republic]

Pakistan has free media. Most channels you think of are dubai based and not truly Pakistani
Infact, i dont see a single truely english channel/news paper in Pakistan

What do you mean by free ???

India wale kya jail se operate karte hai ??
Even if their HQ are based in Dubai, they have to operate in Pakistan. And you know who dictats the terms when it comes to army in Pakistan.
But I am not discussing this type of freedom.
In India, Pakistan and most of the third world countries media houses are run by big business houses. Every business house has affinity with some party or other. Many have multiple affinities. These people never come to the screen, but control what will be shown to the public, how and for how many days. The producers, directors, editors and reporters of the aired content are only servents. They have to do what their master will tell them to do.

And no master is fool enough to go against the Badshah. Otherwise he will not be able to do the business.

Now come to the reporters and anchors.

Tell me where most learned people go for job in India and Pakistan ??
Obviously in sarkari naukari. Less learned go to corporate sector barring few exceptions. Uske baad aise gadhe, Jo smart aur batcheet me tej hote hai, they become reporters and anchors, again barring few exceptions.
Unhe ghante ka kuchh pataa Nahi hota.

This sums up all my argument.
Regards.

 

[nahtanbob]

Low skilled labor to the Middle East.

with oil prices decreasing ??