ISLAMABAD: Foreign Minister Bilawal Bhutto Zardari has stated that the International Monetary Fund (IMF) is not being fair to Pakistan, adding that the country is in a “a perfect storm” of crises.
Cash-strapped Pakistan is in a race against time to implement measures to reach an agreement with the Fund. The agreement with the IMF on the completion of the ninth review of a $7 billion loan programme — which has been delayed since late last year — would not only lead to a disbursement of $1.2bn but also unlock inflows from friendly countries.
The prerequisites by the lender are aimed at ensuring Pakistan shrinks its fiscal deficit ahead of its annual budget around June.
Pakistan has already taken most of the other prior actions, which included hikes in fuel and energy tariffs, the withdrawal of subsidies in export and power sectors, and generating more revenues through new taxation in a supplementary budget.
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As a last step, the international lender has required Pakistan to guarantee that its balance of payments deficit is fully financed for the remaining period of an IMF programme.
In a wide-ranging interview with the Associated Press on Friday, Bilawal said that Pakistan was facing an economic crisis, the consequences of last year’s catastrophic flooding and terrorism which was “once again rearing its ugly head”.
According to the report, the minister sharply criticised the IMF.
Bilawal said the PPP supported expanding revenue collection and believed those who were well off should pay more, but added that Pakistan had been unable to achieve structural tax reform “for the last 23 IMF programmes that we have been a part of.”
“Is it really the time to nitpick about our tax policy and tax collection while we’re suffering from a climate catastrophe of this scale?” Bilawal asked.
The IMF is not being fair to Pakistan, which is also dealing with 100,000 new refugees following the West’s withdrawal from Afghanistan and “a steady uptick of terrorist activities within our country,” the publication quoted him as saying.
He further said that the IMF was stretching out talks at a time when the country needed money to help the “poorest of the poor”.
“And they’re being told that until their tax reform is not complete, we will not conclude the IMF programme.”
He said that Pakistan was able to navigate the Covid-19 pandemic, the Taliban’s takeover of Afghanistan, as well as inflation and supply chain disruptions.
But then last year’s floods devastated the country, he said, calling it the “biggest, most devastating climate catastrophe that we’ve ever experienced.”
Pak-China ties
He further said that Pakistan had a “very healthy economic relationship” with China that was “also in the spotlight as a result of geopolitical events”.
Copyright Business Recorder, 2023