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How close is Pakistan to default

Pakistan's economic conditions are extremely worse these days.

-CDS at 75.5%
-IMF next review delayed
-SBP reserves at only~7.96BN$
-Many repayments coming
-Imports(by LCs) already banned
-USD rate forced by SBPs
-Black market USD touching 244Rs

Big crisis are knocking doors
 
,..,.,
Possible Default Impacts:

1. Massive currency devaluation
2. Heavy spending cut/lower salaries
3. Banking crises (may default too)
4. Debt restructure at cost of 5&6
5. Taxes++
6. Assets possession
7. No new loans for long
 
All arrangements are made but not Public due to fluid political situation created by donkey khan.

No foreign govt look to be partisan in our mess and rightly so. Once COAS appointment dust settles, Imrandoos dies down their natural death, things start improving briskly IA.
What political situation? By a few thousand people attending rallies and IK sitting with a broken leg in hospital ? PDM has absolute majority in parliament with no opposition anywhere.

This IK narrative is only a smokescreen to hide the incompetency of PDM. Financial institutions only look at fundamentals , and not BS like ‘ COAS appointment date’ lol. Ganjadoos need take their head out of the sand and stop giving silly excuses. Foreign govts had no issues giving loans when PTI took over.

“All arrangements are made but not Public due to fluid political situation created by donkey khan.”
What an idiotic assertion. You have things stabilized then why put people in misery unneeded. What is top secret here? Nothing - Ishaq Dar and PDM think that they can fix economy by running rumors in the market.
 
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,..,.,
Possible Default Impacts:

1. Massive currency devaluation
2. Heavy spending cut/lower salaries
3. Banking crises (may default too)
4. Debt restructure at cost of 5&6
5. Taxes++
6. Assets possession
7. No new loans for long

Everything on the list above seems survivable by the indomitable spirit of the people of Pakistan.
 
Irony an enemy Indian trying to cool down fears; ignited by by sell outs Pakistanis aka Imrandoos.
Indians have always supported the PDM parties- during IK and establishment alliance you along with the Indian posters here posted all kinds of ‘economic devastation and impending default’ fears. Now the same posters are helping you out with assurances of calm. Nothing has changed. This is concerning because the same posters justify ethnic cleansing of Islam and Muslims from their own lands, so it is very surprising them try to help out PDM and even the establishment now on PDF !
 
Dar's tactics seem to be working:

Current account deficit shrinks 68.13pc YoY to $0.57bn in October


With some good news:

Oil dips near 2-month lows as supply concerns ease


and some bad news:

The (unsurprising) drop in textile exports

 
,..,.,
Possible Default Impacts:

1. Massive currency devaluation
2. Heavy spending cut/lower salaries
3. Banking crises (may default too)
4. Debt restructure at cost of 5&6
5. Taxes++
6. Assets possession
7. No new loans for long
Asset possesion
Plz explain
 
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Pakistan's economy is in upheaval, and its reserves are running out.

According to the latest data, the cost of insuring exposure to Pakistan’s five-year sovereign debt rose by 1,224 basis points over the weekend, hitting the highest-ever level of 92.53%.

Talks with the International Monetary Fund (IMF) over the ninth review of the loan facility have come to a stalemate, while no help seems to be forthcoming from friendly nations.

All financial and credit rating agencies have been ringing alarm bells for Pakistan.

The Pakistani rupee (PKR) continues to fall. The currency has lost 2.24 rupees or 1% against the greenback in the last seven trading sessions.

The political uncertainty in the country has also exacerbated its economic woes.

Its total debt and liabilities stood at Rs 62.46 trillion in July-September FY2023.

Pakistan is scheduled to repay $1 billion against a five-year Sukuk (Shariah-compliant bond) maturing on December 5, 2022. The CDS increase indicates that investors were worried that the country would miss its obligation to repay credit holders $1 billion because the Sukuk is due to mature.

The IMF has shown its wrath over non-compliance with some very important conditions including laws for state-owned enterprises (SOEs) and flood-reconstruction estimation. The international body is also delaying its review due to the Army chief’s appointment and protests by Imran Khan’s party PTI as well as the Long March.

The State Bank of Pakistan's (SBP)’s reserves fell to $7.96 billion. Actually, Pakistan has zero reserves in its central bank, as $2.3bn of it was credited by China, $3bn deposited by Saudi Arabia, and $1.2bn came from the IMF.

Imports (by letters of credit, or LCs) are already banned, but surprisingly imports of coal and vegetables increased from Afghanistan in recent months. There is a clear trade imbalance due to the banning of trade with India.

In the past, Afghanistan was dependent on Pakistan but now the situation has reversed. Pakistan is buying coal from Afghanistan at high rates to fulfill fuel demands. Due to the surge of cross-border trade and the smuggling of dollars in Afghanistan, the foreign currency rate in the open market is about PKR 240 to PKR 244.

Pakistan’s total debt and liabilities peaked by an unsustainable 24% to Rs 62.5 trillion at the end of September 2022 – pushing the country into uncharted territory.

Another alarming factor is that Pakistan’s remittances reached an all-time low in recent months. The inflow of workers’ remittances declined by 15.7 percent in the month of October 2022.

After finance minister Ishaq Dar’s claim of bringing down the dollar rate to PKR 180 or PKR 200, people started inflows through the black market/Hundi to get higher rates. This is why, the interbank rate of the dollar is PKR 223 now, but in the black market, the dollar is floating at PKR 240. According to economic experts, during the last 4 months, Pakistan faced a 1 billion dollar loss in remittances.

Pakistan has not yet succeeded to get any financial facilities from China and Saudi Arabia despite Prime Minister Shehbaz Sharif’s visits to both countries. The financial facility from friendly countries is also dependent on the IMF 9th review.

Pertinently, Fitch downgraded Pakistan’s long-term issuer default rating to CCC+ from B-, while Moody’s lowered the country’s issuer and senior unsecured debt ratings to Caa1 from B3. S&P has already downgraded Pakistan.
 
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