IMF single account call may cause civil-military row

[Maula Jatt]

Pakistan needs to get off IMF programs if it wants to retain an independent country.

Bring your fiscal house in order.
Increase tax net - not squeeze more out of the poor people already in the net
Reduce non-development and non-defense expenditure
Sell off Government owned assets that deliver non-essential services
Lease government assets out to private entities (not sell - like rail rights, air rights) - keep the core asset ownership, but lease out the operating functions.
Expand exports, and internal consumption
Ban and apply strong tariffs on products that are non-essential
Simplify the tax code and apply it on consumption - and build strong enforcement of consumption VAT application
Reduce VIP culture and associated expenditure (clubs, golfs courses, hostels, guest houses etc etc)

Problem is no executive is willing to take hard decisions that will be un-popular with the ruling class and bureaucracy. The Pakistani bureaucracy is the biggest drag on this nation.

honestly I read first line than skipped to last- got bored and went to "gauri aaya" video
I liked his solution better
I want him as our PM!!

 

[Norwegian]

SBP - independent ( IMF controlled )

Who says it's IMF controlled when you called it independent? Are you nuts or just Bughaz Imran overdose?

defense sector funds - in SBP accounts - IMF controlled

Govt will still control the funds not IMF. SBP is Pakistani bank and doesn't belong to IMF, Bughaz Imrani

IMF decides what money to release and what not

Yes, as long you are bankrupt and depend on IMF, you should listen to IMF and do the reforms

PM IMRAN was brought to sell out Pakistan entirely to IMF - & he's succeeding -

Here comes the Bughaz Imran out as I predicted

as for establishment , they created this Frankenstein and now will pay the price

So why couldn't they fix the economy before Bughaz Imran had to take over?

change my mind

Stop eating Khota Biryani, it will change your mind

IMF has extended 13 bailout bailout packages to Pakistan since 2013. How come this condition was never fulfilled prior to present Pakistani government?

Why previous governments were exempted from this one-account condition and current government is being asked to fulfill it? May be prevuious governments were too compliant with their masters that they were ready to fullfill any demand without even being asked.

22 loans from IMF since 1958. Is IMF too obsessed with Bughaz Imran?

 

[Norwegian]

We had better economic conditions and other fiscal options at that time.

Really? Then how did that happen? 3 financial crashes for the past 20 years!

IK has tasbee in this hands. And that is what worries me that this person is a Fake.

But you still trust this idiot

 

[TNT]

SBP - independent ( IMF controlled )

defense sector funds - in SBP accounts - IMF controlled

IMF decides what money to release and what not

-----------------------

PM IMRAN was brought to sell out Pakistan entirely to IMF - & he's succeeding -


as for establishment , they created this Frankenstein and now will pay the price

change my mind

Every Frankenstein in Pakistan have been created by the establishment. Bhutto, nawaz, zardari, altaf, fazlu and now imran khan. Name one normal good person that been promoted or helped by this establishment. It seems as if the establishment goes to large lengths to find utter evil corrupt morons and place them in government. Makes me wonder if the real evil and the real root cause of all our problems is the establishment actually.

 

[Blacklight]

IMF single account call may cause civil-military row

October 27, 2021



As the IMF is seeking from Pakistan to transfer all government accounts to the State Bank of Pakistan and put it in a single account under its phase II financial sector reforms, the move may become a bone of contention between the civil-military establishment.

It comes against the backdrop of PM Imran Khan issuing the much-awaited notification of the new DG ISI after over two weeks' delay. A perception that the delay in notification caused tension between civil-military ties, gained traction. However, the notification helped remove some clouds of uncertainty.

In Pakistan, the IMF financial reform II will affect Strategic Plans Division (SPD), all three services, Joint Staff Headquarters (JS HQ), ISI, and also “command funds” at all levels. The command funds are on government’s authorized titles like names of units, for example. In all the countries where it has experimented, no special clauses for security establishment were allowed by the IMF.

The IMF's policy of the treasury single account condition has been experimented in Latin America and some African Countries like Nigeria so far, and all had many controversies related to this policy.
It is believed that there were up to 30,000 bank accounts maintained by the defense ministry, and the armed forces that have to be closed under the second phase of the financial management reforms in Pakistan.

The way it works is that all accounts of government setups with other banks need to be closed and transferred to SBP, or all bank accounts to be swept at the close of business every day and transferred to the SBP account.

In simple words “all money belonging to the national treasury, not in use is gathered in a single account in SBP so that instead of wasting in various small portions it can be used by government instead of borrowing from outside", as the theory goes.

The banks are currently using these funds, and are also lending to the government out of them. Thus, it is ostensibly aimed at reducing or avoiding situations where some departments may maintain credit balances while others are overdrawn. This will help the government reduce internal expenses/internal loan expenditure.

It will also likely reduce bank profitability and banks will have to compete for funds from the market which will limit the flow of cash, warns financial experts. "This phenomenon will reduce inflation and rupee devaluation, but will also reduce investment and private sector funding thus reducing GDP growth", they quipped.

In the nutshell, the theoretical benefits of the Treasury Single Account policy have not materialized anywhere on the ground, though theoretically they should follow. It has been observed that the TSA only slowed down the economy and delayed the creation of jobs instead of materializing theoretical benefits.

If this condition of the IMF is fulfilled (most likely it has been agreed to by the PTI government) special security provisions for the establishment especially ISI, MI, MO, and SPD should be made to exclude secret funds from the TSA. This will also help avoid friction between civil-military leadership.

The challenge for the government is that if it fails to implement the financial reform, it may endanger the next IMF program worth $6 billion. It simultaneously underscores the PTI government’s failure to convince the IMF of the country-specific context of Pakistan and the sequencing of the TSA reform.

https://www.thenews.com.pk/print/903499-imf-single-account-call-may-cause-civil-military-row



Treasury Single Account: An Essential Tool for Government Cash Management

https://www.imf.org/external/pubs/ft/tnm/2011/tnm1104.pdf

I dont think IMF's lackeys are interested in an Iwo Jima

 

[ARMalik]

End of the day, the biggest problem of the country is the massive corruption within its ruling elites and its Military Generals. One perfect example is General Zia keeping Baldy fat Nawazoo as his pet, and then this corrupt individual Nawazoo becomes PM of the country MANY TIMES !!! This can only happen when there is MASSIVE corruption in the country's elites and specially the Military elites.

Unfortunately, the country just cannot survive for along when there is this unprecedented Loot and Plunder taking place.

 

[SQ8]

Pakistanis: We are being punished by western evils for being pious muslims by IMF and other agencies.

Also Pakistanis: Engage in corruption in every aspect of their lives from birth to death and elect corrupt leaders to continue this lifestyle, cheat at taxes both at home and abroad, falsify immigration and financial data to send money home illegally since 1959 along with cheating on weights and balances(anyone remember a similar peoples mentioned in the Quran?) Yet they pay less per capita on living costs than most other countries with similar poverty and corruption issues but continue to whine about it. Did I mention the corruption within the strategic programs?

This punishment is long coming for Pakistan and its citizens deserve every bit of it and more.

 

[truthfollower]

Pakistanis: We are being punished by western evils for being pious muslims by IMF and other agencies.

Also Pakistanis: Engage in corruption in every aspect of their lives from birth to death and elect corrupt leaders to continue this lifestyle, cheat at taxes both at home and abroad, falsify immigration and financial data to send money home illegally since 1959 along with cheating on weights and balances(anyone remember a similar peoples mentioned in the Quran?) Yet they pay less per capita on living costs than most other countries with similar poverty and corruption issues but continue to whine about it. Did I mention the corruption within the strategic programs?

This punishment is long coming for Pakistan and its citizens deserve every bit of it and more.

land pure of thieves by the thieves for the thieves!

I dont think IMF's lackeys are interested in an Iwo Jima

we need to give up nuclear program nukes?

 

[Blacklight]

we need to give up nuclear program nukes?

Writing has been on the wall for a long time.

 

[Patriot forever]

One can understand why IMF puts such onerous pre-conditions. All banks, even the individuals want to ensure that you would be able to return their funds and are capable of paying the interest before they transfer the cash. My mortgage company had even insisted that I take on a ‘Repayment Protection Insurance’ before agreeing to my mortgage.

Only way to get of the IMF trap is to improve the Tax Collection. For example agriculture sector is either exempted from income tax or contributes very little. The agriculture sector contributes 19.2 percent to GDP, but its share in taxes is negligible. Additionally Tax theft in other sectors such as small-scale retail (neighbourhood grocery stores) is also very common. Most of GOP revenue is therefore from indirect taxes. Even an illiterate person knows that spending more than your income is recipe for disaster. Therefore what is really needed is a major overhaul of the Tax system but thus far no gov’t in power, whether Military or Civilian, had the spine to do it.

Additionally, in the modern age high standard of education and technical skill is a must. Sadly Pakistan is retrogressing. Instead of raising the standards of the state school education, successive governments starting from ZAB’s PPP nationalisation of schools to the current uniform curriculum, have been attempts to pull the education standards down. Instead of making science subjects and English compulsory, PTI has made learning of Arabic compulsory! The logic is similar to since every one can’t have cars, you ban private ownership of cars and force everyone to ride the bicycle!

During the Ayub era average Pakistani was economically better that Indian and most East Asian countries. Then came the Asian Tigers and South East Asian countries left us behind. BRIC countries during the 2000 to 2015 left Pakistan far behind. Now Bangle Desh as well as Sri Lanka has higher GDP per capita than Pakistan. It appears that Pakistani policy makers are hell bent upon making Pakistan poorer than Afghanistan as well.

Sir just one point we are at IMF because of our inability in the external domain to earn dollars more than its relation with our tax collection ( I understand our weakness in this domain).

Increasing our exports is far more important than tax collection to avoid IMF.

We were not able to grow our exports as compared to other countries. If not for the remittances we would be bankrupt along time ago..

In short there is no need for IMF if we manage our external liabilities. CAD and our debt repayments are the reason.

 

[Norwegian]

We were not able to grow our exports as compared to other countries. If not for the remittances we would be bankrupt along time ago..

In fact we are bankrupt every 5 years if IMF do not bail us out each time. How Shameful is that? A sovereign nation, a nuclear power, living on non stop foreign aid?

In short there is no need for IMF if we manage our external liabilities. CAD and our debt repayments are the reason.

We take on new external debt to payback past external debt. It's a ponzi scheme, a house of cards that will collapse sooner or later.

 

[maithil]

Many calls for raising exports.. to where ? West ? Why would they encourage that if IMF is acting on their direction?

 

[arjunk]

Writing has been on the wall for a long time.

Libya was an example of what happens when you comply with such demands.

 

[Norwegian]

Libya was an example of what happens when you comply with such demands.

So don't go bankrupt every 5 years if you wish to avoid Imf in future

 

[Genghis khan1]

Basic common sense Rules For (any) loans:

* Do not take any loan that you are not able pay back.

* Do not spending loans on Projects that are not guaranteed to generate income.

* If lender is not confident enough that you will pay back, and ask you to add collateral than you are not capable and should not be taking that loan to began with.

Fact of a matter is, if it wasn’t for Billions of $$ that overseas Pakistanis send every year, country would have gone bankrupt long ago.