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Pakistan

‘Pakistan is running out of time,’ warns PBC as IMF programme hangs in balance

  • As stakeholders contest short-term power, Pakistan's long-term future is in jeopardy, says Pakistan Business Council
Published March 22, 2023

The Pakistan Business Council (PBC), one of the country’s largest corporate advocacy platforms, has warned that time is running out for the country as it struggles to resume the International Monetary Fund (IMF) programme.

“As stakeholders contest short-term power, Pakistan’s long-term future is in jeopardy,” said the PBC in a tweet on Wednesday.

“Drip feed and hope will not suffice. Without IMF’s programme and debt re-profiling, help from friendly nations is not forthcoming.”

“Pakistan is running out of time,” it added.

The statement comes as Pakistan reels from one of its worst economic crises in history. The South Asian country has been faced with a barrage of woes with a perceived default risk and downgrade by international ratings agencies reflecting the state of the economy that has also had to bear major political turmoil and frequent change in key leadership.

Pakistan remains in talks with the international lender for the resumption of the IMF’s Extended Fund Facility (EFF), which has been stalled since last year.

The bailout programme’s revival has been deemed crucial to stabilise the economy that has been hit by a severe dollar shortage in recent months with reserves held by the central bank treading at critically low levels.

Last month, PBC had underscored the need to secure IMF support as well as maintain a narrow exchange rate, stem losses, cut expenditure and reduce the use of imported fuel for energy to put the country on a sounder base in the medium to longer term for economic stability.

Its CEO Ehsan Malik also forwarded suggestions to Federal Finance Minster Ishaq Dar that he said could be implemented quickly to enhance tax revenue from the un-taxed and under taxed sectors of the economy and to economize public expenditure to manage fiscal account.

PBC’s latest warning comes after Bloomberg economists also warned that the country could be heading towards default if funding from the IMF is not secured.

Pakistan is careening toward a potential default as soon as June unless it secures aid from the IMF,” wrote Bloomberg economists Ankur Shukla and Abhishek Gupta.

“Our base case is that the IMF will deliver the remaining $2.6 billion in aid under the current bailout program by June – helping Pakistan wiggle through the immediate crisis – as the country has fulfilled most of the IMF’s conditions.”

“If the aid does not arrive, though, we think China will help plug the gap to head off a default,” they added.

Comments

Comments are closed.

Tulukan Mairandi Mar 22, 2023 02:58pm
Pakistan should reduce imports. There are companies in Pakistan importing indian goods at 3x the price, via Dubai, labeled Made in UAE. These Indian Goods include tea, machine parts, cosmetics, and even processed human excrement, which is mixed with ground meat and consumed and relished by Pakistanis.
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Shahid Khan Mar 22, 2023 03:36pm
The ruling elite would not care. They are hell bent to take IK out of business
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bonce richard Mar 22, 2023 04:46pm
@Shahid Khan, Our army is a big issue for whole nations. They never want Pakistan will stand by its own leg. Since 1947 they are playing games in the of Islam and Kashmir. Nawaz and Zardari both are nothing they take the dictation from GHO, which Imran Khan denied.
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bonce richard Mar 22, 2023 04:49pm
@Tulukan Mairandi, No need to import if Govtwants our country will be self-sufficient in her requirements of food and other items. But Govt not sincere because the commission is involved.
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TimeToMovveOn Mar 22, 2023 05:48pm
@bonce richard, "if Govtwants our country will be self-sufficient " This is like saying if I am rich, I will not be poor. That is the problem. Your govt does not care about producing internally, why not at least import directly from India than paying 3x via Dubai. It is not like, you are getting Kashmir anyway.
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Haq Mar 22, 2023 08:56pm
Seems IMF on behest of int'l estb' wants Pakistan to surrender it's military might, in currently evolving global / multi-polar scenario. Ruling elite is too busy in evading corruption cases, wrangling amoungst themselves & washing dirty laundry in public (audios, videos, tweets, statements..)
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Maqbool Mar 22, 2023 11:54pm
The none seriousness of our Rulers in not in the country’s interest, PBC is correct in warning the Govt. Pakistan is not even on the IMF agenda till June 2023, allowing 45days for disbursement takes us to;Aug 2023, do we have the time ? Even Our Tax system is non serious . How can the Max Tax for non Salaried be fixed at 35 % on Rs 6m when the min Wage in U SA is over Rs 8.5m. Why would an Overseas Pakistani invest in Pakistan and pay 35% Tax which is lower than their existing Minimum Wages there ? It would be logical for AOP instead of paying 35% Tax at Rs 6m to pay themselves or their family Salaries instead , of the same amount and pay only 20% instead , same for individual Professionals, it seems the system is for the Those that think off the books . The Present FBR policy is that a Salaried person earning Rs 2,000,000 per month, pays the same tax rate as others individuals earning only Rs 500,000 per month. Illogical,
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TimeToMovveOn Mar 23, 2023 12:22am
@Haq, "wants Pakistan to surrender it's military might" This has been debunked. NO one is asking Pak to surrender its military might. Pakistan is NOT a military might. And Pak is a nobody in the international scene to matter to anone. So no one cares. Dont give yourself too much credit.
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Nadir Mar 23, 2023 03:07am
Army is the biggest issue as they have state within/above the state. Once army’s economy is audited and brought back to country’s economy thing will get better
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Ali akhtar Mar 23, 2023 10:24am
@Tulukan Mairandi, I assume you can goto the dubai police with your evidence about human excrement; may be stay at home and find out if people are drinking real cow urine or may be its mixed with human, cat or squirrel urine. You need to investigate this matter since clearly you have an expertise in this field.
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Ali akhtar Mar 23, 2023 10:26am
@bonce richard, the army is the problem in pakistan. It's too big and too powerful. The country cannot afford it. Pakistan should never have tried to compete with India. It should follow Bangladesh and have a small army, good relations with neighbours and develop it's economy
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Damian Mar 23, 2023 11:45am
@Haq, what military might? It's a myth.
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Mubashar Mirza Mar 23, 2023 12:42pm
We as Pakistani should unite as one Nation. We should support and respect our national institutions. No politics for disunity. People will come and go as mostly politicians are Senior Citizens as they are above 70 years. Follow basic norms n help needy n pay Zakat. I see bright n prosper Pakistan's future. So stop talking pessimistic and against Pakistan for the sake of politics. Stay home stay safe n avoid negativity.
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Abbujan Mar 23, 2023 07:52pm
@Tulukan Mairandi, a randian a day keeps laughter at bay, thanks for you valuable input, lol
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Cheerful Mar 24, 2023 04:50am
@bonce richard, baseless assessment.. We as a nation are in a habit to accuse and curse and Do Nothing for self assessment /improvement... Before pointing Zardari Nawaz or GHQ, just see what u have done for this country... Any contribution u made till now???
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bonce richard Mar 24, 2023 08:18pm
@Cheerful, Nothing only they care own pocket.
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Hafeez Mar 25, 2023 07:53am
Compromised generals have compromised the future of Pakistan!
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