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Markets optimistic as Pakistan 'breaks IMF begging bowl forever'
By Farhan Bokhari in Islamabad
Published: November 22 2004 02:00 | Last updated: November 22 2004 02:00
Pakistan's business leaders expect the Karachi stock market to rise today, driven by the decision of Shaukat Aziz, prime minister, to end ahead of schedule the country's loan programme with the International Monetary Fund.
"The begging bowl has been broken forever," said Mr Aziz on Friday evening as he announced that Pakistan had declined the last two tranches from the fund of $260m (€199.3m, £139.9m), due to be paid this month. The move ends a three-year loan programme with the IMF of $1.52bn, scheduled to end in December.
In measures aimed at lifting the Pakistani economy, Mr Aziz also removed a two-year freeze on recruitment in government services and ordered the creation of courts to resolve business disputes more quickly. .
"These measures have created a lot of optimism. There's bound to be a positive reaction across the board," said S.M. Muneer, former chairman of the Karachi Chamber of Commerce and Industry.
Mr Muneer said many business people expected the economy to get a boost as the country was freed of IMF loan conditions that forced the government to cut spending.
The Federation of Pakistan Chambers of Commerce and Industry - the largest national business body - said: "New opportunities for economic growth are likely to come up. There is a new emphasis on taking the economy forward."
Western economists warned that Pakistan's successful exit from the IMF programme must be followed by continued efforts from the government to reduce losses in the public sector, especially in the Water and Power Development Authority and the Karachi Electricity Supply Corporation.
"Pakistan's economic challenges have not ended," said a Washington-based economist. "A number of reforms still have to be put in place."
Pakistan signed a three-year loan programme with the IMF in 2001 after being on the brink of default following its maiden nuclear tests in May 1998. Those tests triggered economic sanctions from a number of industrialised nations and forced the government to freeze private deposits of about $11bn in onshore foreign currency accounts.
But in the past three years Pakistan's balance of payments position has improved significantly. The government's liquid foreign currency reserves have risen to more than $12bn, the equivalent of 10-11 months of imports.
The improvement in large measure is due to expatriate Pakistanis using regular banks to send funds home rather than the underground networks such as the hawala system.
FT.com / World - Markets optimistic as Pakistan 'breaks IMF begging bowl forever'
Shaukat Tareen leaves for US
Wednesday, October 08, 2008 ISLAMABAD: Advisor to Prime Minster on Finance Shaukat Tareen Wednesday left for Washington on a ten-day official visit. During his visit, he will meet the officials of World Bank and International Monitoring Fund (IMF).
It is his first foreign visit after assuming the charge as Advisor to PM on Finance, Tareen is accompanied by a high level delegation comprising Governor State Bank of Pakistan Dr Shamshad Akhtar, Secretary Finance and Economic Affairs Divisions.
During his different meetings abroad, he would discuss the borrowing facilities for the country and the agenda of the Friends of Pakistan meeting to be held in Abu Dhabi next month.
Shaukat Tareen leaves for US
Zardari expects world to come up with $100bn
NEW YORK, Oct 4: Citing the threat posed by militants along the Pakistan-Afghanistan border and the possible economic meltdown, President Asif Ali Zardari has asked the international community to give Pakistan $100 billion in grant to ensure the country’s survival.
“I need your help, if we fall, if we can’t do it, you can’t do it,” Mr Zardari repeatedly said during an interview with Wall Street Journal’s columnist Brent Stephens, published on Saturday.
In the interview, Mr Zardari also called for a broader free trade agreement with India and said: “India has never been a threat to Pakistan.
“I, for one, and our democratic government is not scared of Indian influence abroad.”
Stephens said in his column that Mr Zardari spoke of the militant groups operating in occupied Kashmir as “terrorists”, adding that he had no objection to the India-US nuclear cooperation pact so long as Islamabad was treated “at par” with New Delhi.
“Why would we begrudge the largest democracy in the world getting friendly with one of the oldest democracies in the world?”
On Mr Zardari’s request for $100 billion in grant, Stephens says that he “has a simple and powerful argument to make that the world cannot allow his government to fail – not when it’s becoming increasingly plausible that Pakistan itself, with its stockpile of as many as 200 nuclear warheads, could be toppled by Al Qaeda and its allies”.
In asking the international community for infusion of $100 billion into Pakistan’s economy, Stephens said Zardari was keen to insist that it not be described as aid.
“Aid is proven through the researches of the World Bank . . . (to be) bad for a country,” Zardari told WSJ. “I’m looking for temporary relief for my budgetary support and cash for my treasury which does not need to be spent by me.
“It is not something I want to spend. But (it) will stop the
(outflow) of my capital every time there is a bomb. . . . In this situation, how do I create capital confidence, how do I create businessmen’s confidence?”
On US-Pakistan differences to conduct the war on terror, Mr Zardari was anxious to downplay any differences with the US. “I am not going to fall for this position that it’s an unpopular thing to be an American friend. I am an American friend,” Zardari said time and again.
On the incident last month in which Pakistani troops allegedly fired at US aircraft, Zardari told WSJ: “It was merely an incident, and while incidents do happen, they are not important.”
He goes off the record to describe sensitive military subjects, but acknowledges that the US is carrying out Predator missile strikes on Pakistani soil with his government’s consent. “We have an understanding, in the sense that we’re going after an enemy together.”
Zardari, Stephens maintained, also conceded “the problem that had bedevilled past efforts at US-Pakistani cooperation, particularly in intelligence sharing: the widely held suspicion that Pakistani intelligence services continue to cooperate with, and even arm, the Taliban.”
“You know, you keep an uglier alternative around so that you may not be asked to leave,” he says in reference to charges that former president Pervez Musharraf was not sincere in fighting militancy.
Mr Zardari refuses to go into detail other than to say he “solved the problem”.
Mr Zardari expressed a hope that, with the intelligence problem out of the way, a new era of cooperation can open up with the US. “We want to be able to share [US] intelligence,” he told WSJ. “We need helicopters, we need night goggles, we need equipment of that sort.”
He said there was a need for precision and finesse in fighting militants, rather than large-scale military force. “My eventual concept is that we should be taking them on as they are, as criminals.”
Of Osama bin Laden, Zardari said: “The minute I make anybody my enemy, he becomes as big as I am.”
Referring to reports that Pakistan has deployed F-16s against militants in tribal areas in part because the army’s own troops have been routinely routed in ground fighting, he said: “Their problems aren’t simply tactical. What kind of a joke is this that I cannot pay my security personnel more than the Talibs are paying?”
“Those terrorists are paying their soldiers 10,000 rupees; I’m paying seven or six thousand rupees.
“The effects of such a disparity are increasingly in evidence. The recent bombing of Islamabad’s Marriott hotel, in an area that is under particularly tight security controls, is a fresh reminder that Pakistan’s terrorist problem extends well beyond the tribal hinterlands,” Stephens argues in his concluding note.
Zardari expects world to come up with $100bn -DAWN - Top Stories; October 05, 2008
By Farhan Bokhari in Islamabad
Published: November 22 2004 02:00 | Last updated: November 22 2004 02:00
Pakistan's business leaders expect the Karachi stock market to rise today, driven by the decision of Shaukat Aziz, prime minister, to end ahead of schedule the country's loan programme with the International Monetary Fund.
"The begging bowl has been broken forever," said Mr Aziz on Friday evening as he announced that Pakistan had declined the last two tranches from the fund of $260m (€199.3m, £139.9m), due to be paid this month. The move ends a three-year loan programme with the IMF of $1.52bn, scheduled to end in December.
In measures aimed at lifting the Pakistani economy, Mr Aziz also removed a two-year freeze on recruitment in government services and ordered the creation of courts to resolve business disputes more quickly. .
"These measures have created a lot of optimism. There's bound to be a positive reaction across the board," said S.M. Muneer, former chairman of the Karachi Chamber of Commerce and Industry.
Mr Muneer said many business people expected the economy to get a boost as the country was freed of IMF loan conditions that forced the government to cut spending.
The Federation of Pakistan Chambers of Commerce and Industry - the largest national business body - said: "New opportunities for economic growth are likely to come up. There is a new emphasis on taking the economy forward."
Western economists warned that Pakistan's successful exit from the IMF programme must be followed by continued efforts from the government to reduce losses in the public sector, especially in the Water and Power Development Authority and the Karachi Electricity Supply Corporation.
"Pakistan's economic challenges have not ended," said a Washington-based economist. "A number of reforms still have to be put in place."
Pakistan signed a three-year loan programme with the IMF in 2001 after being on the brink of default following its maiden nuclear tests in May 1998. Those tests triggered economic sanctions from a number of industrialised nations and forced the government to freeze private deposits of about $11bn in onshore foreign currency accounts.
But in the past three years Pakistan's balance of payments position has improved significantly. The government's liquid foreign currency reserves have risen to more than $12bn, the equivalent of 10-11 months of imports.
The improvement in large measure is due to expatriate Pakistanis using regular banks to send funds home rather than the underground networks such as the hawala system.
FT.com / World - Markets optimistic as Pakistan 'breaks IMF begging bowl forever'
Shaukat Tareen leaves for US
Wednesday, October 08, 2008 ISLAMABAD: Advisor to Prime Minster on Finance Shaukat Tareen Wednesday left for Washington on a ten-day official visit. During his visit, he will meet the officials of World Bank and International Monitoring Fund (IMF).
It is his first foreign visit after assuming the charge as Advisor to PM on Finance, Tareen is accompanied by a high level delegation comprising Governor State Bank of Pakistan Dr Shamshad Akhtar, Secretary Finance and Economic Affairs Divisions.
During his different meetings abroad, he would discuss the borrowing facilities for the country and the agenda of the Friends of Pakistan meeting to be held in Abu Dhabi next month.
Shaukat Tareen leaves for US
Zardari expects world to come up with $100bn
NEW YORK, Oct 4: Citing the threat posed by militants along the Pakistan-Afghanistan border and the possible economic meltdown, President Asif Ali Zardari has asked the international community to give Pakistan $100 billion in grant to ensure the country’s survival.
“I need your help, if we fall, if we can’t do it, you can’t do it,” Mr Zardari repeatedly said during an interview with Wall Street Journal’s columnist Brent Stephens, published on Saturday.
In the interview, Mr Zardari also called for a broader free trade agreement with India and said: “India has never been a threat to Pakistan.
“I, for one, and our democratic government is not scared of Indian influence abroad.”
Stephens said in his column that Mr Zardari spoke of the militant groups operating in occupied Kashmir as “terrorists”, adding that he had no objection to the India-US nuclear cooperation pact so long as Islamabad was treated “at par” with New Delhi.
“Why would we begrudge the largest democracy in the world getting friendly with one of the oldest democracies in the world?”
On Mr Zardari’s request for $100 billion in grant, Stephens says that he “has a simple and powerful argument to make that the world cannot allow his government to fail – not when it’s becoming increasingly plausible that Pakistan itself, with its stockpile of as many as 200 nuclear warheads, could be toppled by Al Qaeda and its allies”.
In asking the international community for infusion of $100 billion into Pakistan’s economy, Stephens said Zardari was keen to insist that it not be described as aid.
“Aid is proven through the researches of the World Bank . . . (to be) bad for a country,” Zardari told WSJ. “I’m looking for temporary relief for my budgetary support and cash for my treasury which does not need to be spent by me.
“It is not something I want to spend. But (it) will stop the
(outflow) of my capital every time there is a bomb. . . . In this situation, how do I create capital confidence, how do I create businessmen’s confidence?”
On US-Pakistan differences to conduct the war on terror, Mr Zardari was anxious to downplay any differences with the US. “I am not going to fall for this position that it’s an unpopular thing to be an American friend. I am an American friend,” Zardari said time and again.
On the incident last month in which Pakistani troops allegedly fired at US aircraft, Zardari told WSJ: “It was merely an incident, and while incidents do happen, they are not important.”
He goes off the record to describe sensitive military subjects, but acknowledges that the US is carrying out Predator missile strikes on Pakistani soil with his government’s consent. “We have an understanding, in the sense that we’re going after an enemy together.”
Zardari, Stephens maintained, also conceded “the problem that had bedevilled past efforts at US-Pakistani cooperation, particularly in intelligence sharing: the widely held suspicion that Pakistani intelligence services continue to cooperate with, and even arm, the Taliban.”
“You know, you keep an uglier alternative around so that you may not be asked to leave,” he says in reference to charges that former president Pervez Musharraf was not sincere in fighting militancy.
Mr Zardari refuses to go into detail other than to say he “solved the problem”.
Mr Zardari expressed a hope that, with the intelligence problem out of the way, a new era of cooperation can open up with the US. “We want to be able to share [US] intelligence,” he told WSJ. “We need helicopters, we need night goggles, we need equipment of that sort.”
He said there was a need for precision and finesse in fighting militants, rather than large-scale military force. “My eventual concept is that we should be taking them on as they are, as criminals.”
Of Osama bin Laden, Zardari said: “The minute I make anybody my enemy, he becomes as big as I am.”
Referring to reports that Pakistan has deployed F-16s against militants in tribal areas in part because the army’s own troops have been routinely routed in ground fighting, he said: “Their problems aren’t simply tactical. What kind of a joke is this that I cannot pay my security personnel more than the Talibs are paying?”
“Those terrorists are paying their soldiers 10,000 rupees; I’m paying seven or six thousand rupees.
“The effects of such a disparity are increasingly in evidence. The recent bombing of Islamabad’s Marriott hotel, in an area that is under particularly tight security controls, is a fresh reminder that Pakistan’s terrorist problem extends well beyond the tribal hinterlands,” Stephens argues in his concluding note.
Zardari expects world to come up with $100bn -DAWN - Top Stories; October 05, 2008
