IMF doing the same thing to Pakistan as it did to Yugoslavia ?

[INDIC]

It all depends on the politicians in power. IMF targeted India (in 1991 when they bailed us out) way before Pakistan..but our politicians in that time were good. yes it was congress only. But still they managed the economy nicely and in no time we paid back the entire IMF bailout fund.

Unlike our case, Pakistan is suffering because they are not ready for any austerity measures, tax reforms and cutting excessive defence spending etc. But their leaders are successful in making them belief IMF is the bad guy.

 

[illusion8]

Only an idiot will compare yugoslavian Economy with Pakistans. At that time it had hyperinflation And only $4.2 remittances And 16$ billion of foriegn Debt, while Pakistan has only 6-7% inflation, $13 billion remittances, it will pay 550 million debt to IMF next month, Our SEs are also doing well.

A small question.
Do you think this 13 billion in remittances goes to the Government or to the family of the person who's sending it as it is personal money? though it goes into the Pakistani system and is foreign exchange - how does it really mean that Government gets to use it directly to pay debt?

 

[karan.1970]

Only an idiot will compare yugoslavian Economy with Pakistans. At that time it had hyperinflation And only $4.2 remittances And 16$ billion of foriegn Debt, while Pakistan has only 6-7% inflation, $13 billion remittances, it will pay 550 million debt to IMF next month, Our SEs are also doing well.

Pakistan's foreign debt is $ 65 billion which is 4 times yugoslavia's. Its forex reserves are $ 13 billion which is only 20% of its foreign debt. So your remittances may be 3 times of yugoslavia, but your external debt is 4 times..

A small question.
Do you think this 13 billion in remittances goes to the Government or to the family of the person who's sending it as it is personal money? though it goes into the Pakistani system and is foreign exchange - how does it really mean that Government gets to use it directly to pay debt?

Govt gets the $ and pays the family in PKR..

 

[illusion8]

Pakistan's foreign debt is $ 65 billion which is 4 times yugoslavia's. Its forex reserves are $ 13 billion which is only 20% of its foreign debt. So your remittances may be 3 times of yugoslavia, but your external debt is 4 times..



Govt gets the $ and pays the family in PKR..

Isn't printing of PKR hedged against anything?

 

[A.Rafay]

@illusion8 Out of 13bn 8bn is are held in State bank which is govt bank, this money is not going to any families rather its the money which came to be kept in State bank from various Pakistanis business owners across the world, Only 5bn are sent to private banks which may be taken out, but all this has a positive effect on the Economy, govt has nothing to do with this, this is the system which drives exports and imports Between small and medium business in and outside pakistan and maintains value of Rupee thus sustains the economy.

 

[Cheetah786]

ISLAMABAD - Finance Minister Dr Abdul Hafeez Shaikh said on Monday that tax collection has more than doubled during five years of the government, rising from Rs 1 trillion in 2008-09 to Rs 2 trillion in 2012-13. “We have tried to collect taxes from rich and wealthy people under a planned strategy in an effort to raise revenue for development,” he said while responding to media persons at the Brands of the Year Award ceremony at a hotel. The minister said the government has also contained its expenses to 6 percent of the GDP which is well below the inflation rates in the country. He pointed out that federal government has provided an additional Rs 5 trillion to the provinces under National Finance Commission (NFC) Award. Now it was up to the people and the civil society to ask the provinces where they have spent these funds, he added. Shaikh said the provinces have raised their expenses by 21 percent after receiving additional funds from the federation. “Before NFC, provinces were having 48 percent of the divisible pool. Now they have 70 percent and if funds to FATA and AJK are added, this total comes to more than 77 percent,” he said. He noted that the federal government has paid Rs 1600 billion to subsidise the rates of electricity for people. Similarly, the government spent Rs 210 billion under cash transfers for low income groups, he said. Responding to a question, he said Pakistan did not borrow a single US dollar from the International Monetary Fund (IMF) since May 2010. “In fact, we have paid back $ 2.5 billion to IMF on our debt,” he added.

Tax collection has doubled during present govt: Hafeez Shaikh | Pakistan Today | Latest news | Breaking news | Pakistan News | World news | Business | Sport and Multimedia

 

[Cheetah786]

karan.1970;3862136]Pakistan's foreign debt is $ 65 billion which is 4 times Yugoslavia's. Its Forex reserves are $ 13 billion which is only 20% of its foreign debt. So your remittances may be 3 times of Yugoslavia, but your external debt is 4 times..

Minister of State for Finance Saleem Mandviwalla told Dawn on Thursday that the government would notify amendments to Pakistan Remittances Initiative (PIR) rules next week to allow A-Class foreign exchange companies, Islamic banks and microfinance banks to bring in remittances in foreign exchange through official system.

“Our target is to increase remittances from overseas Pakistanis to $20 billion in almost a year but in the short term $1.5-3 billion of additional funds could be brought into the official channel in three to four months,” he said.

“That is the only way of converting current account into surplus on permanent basis,” he said.

He said annual remittances from overseas Pakistanis through official channels currently stood at about $13 billion and almost an equal amount was being sent home by Pakistanis through unofficial channels.

“We can easily divert a pie out of this huge potential into official system in a short period,” he said.

He said the targets for increasing remittances through official channels had been set in consultations with all stakeholders, including banks and foreign exchange companies, adding the A-Class foreign exchange companies could also be granted banking licences in the next phase to better utilise their capacity and network.

In his view, the foreign exchange companies were remitting funds from overseas Pakistanis through hundi system because rules did not allow them to facilitate such transactions in official channels.

He said the international exchange companies were collecting funds from individuals abroad and sending them to Pakistan through banks by sharing an incentive of $25 provided by the government per $1000 transactions with the banks that did not benefit Pakistanis working overseas.

Once domestic exchange companies were allowed into official system, they were expected to share the incentive with the remitter instead of sharing it with banks.

Pakistan's economy last paper i have from state bank was over $200billion/yr that was in last qtr june 2011. we are in 2013 Now so we have Grown even more against all odds so $65billion is not 4 times our GDP plus remittance to pakistan is well above $26Billion/yr not 13 billion as i pointed out above.

 

[muse]

The IMF’s visit

THE IMF mission that was in Islamabad ostensibly to discuss the contours of the next programme has gone back to Washington.

This scribe has been struggling to understand why they visited these shores to ‘negotiate’ a possible programme with a government in its dying days, at a time when Mr Tahirul Qadri was making his own contribution to an already chaotic political situation.

It is simply astounding that in this day and age when all relevant data is easily accessible, available online, or can be transmitted electronically in real time the Fund would send a seven-member mission for two weeks to meet the same officials three times a day.

With elections around the corner the most charitable explanation of their trip this time around and their public announcement that they could be back in February is that they are improving their personal careers and benefits without those designing the programme being liable for the risk of failure.

What is even more disconcerting, however, was that, as usual, much of the ‘negotiation’ process centred around the reduction of the ‘size’ of the budget deficit, by whatever means, with hardly any discussion on the structural issues that have been our bane and which underlie these large fiscal deficits.

The focus continued to be on the production of numbers using excel worksheets for meeting a single objective: achieving a lower, ‘acceptable’ deficit. This obsession has meant that all other policies have become hostage to the fabrication of an artificial number that would please markets and donors, forcing one to conclude that the Fund has learnt little from decades of engagement with Pakistan. This engagement should have taught it how adept we are at playing the numbers game.

The Fund seems quite happy to believe the numbers for revenues and expenditures that have, at best, modest credibility.

Just for illustration take the following cases: the subsidies for fertiliser, wheat and sugar not accounted so far as expenditure in the federal and provincial budgets exceed Rs100 billion; the losses of PIA, Steel Mills and Railways not recognised in the federal budget has crossed Rs350bn; the annual deficits for electricity provision is still not being charged as expenditure, and, building up at an astounding Rs1 million a minute, is more than Rs100bn.

The tragedy is that the Fund has done no real long-term thinking on how to fix our problems, being continuously distracted by its obsession with numbers, nor will it let us develop ours or give us time.

It has lived with this asymmetry for far too long so that all programme failures are sold as our own, while any success is marketed as that of the Fund. The question is: do programmes fail because of lack of implementation or because of poor programme design?

In my view, as in the case of the programme crafted in 2008, the collapse this time around will again be because of programme design. Why is the Fund keen to sign a programme and not the government, thus giving an option to the current set-up to sign a programme and pass failure on to the next government, the ultimate moral hazard?

In its eagerness to design a fresh programme the Fund, yet again, is not letting us come to the realisation that we have a crisis, as we could be confronted with acute pressures on the balance-of-payments position and the rupee by the second quarter of 2013.

Can the Fund, for once, let us face the consequences of our actions or inactions? Sadly, we are just as badly prepared as ever and have not been able to use this opportunity to design our own programme.

It is, therefore, time we all stop repeating past mistakes by concentrating on the magnitude of the fiscal deficit, which is essentially based on phony and fictitious numbers.

What is missing in the Fund’s ‘demands’ is the need for long overdue structural reforms which, as a minimum, should include:

— the discontinuation of commodity financing by the government (its purchases of wheat, fertiliser, sugar etc to subsidise influential interest groups)
— privatisation of state-owned enterprises

— energy sector reforms (by insisting on the deregulation of the sector)
— elimination of the SRO regime

— a fundamental review of the policy framework which is presently producing inadequate growth because it is diverting investment and entrepreneurial energies into unproductive rent-seeking activities. This is creating powerful lobbies fattened on rents earned from protected and sheltered markets.

The strategy of successive governments has been to extract rents for our geo-strategic location and, regrettably, it has paid off each time, enabling us to continually postpone much-needed fundamental reforms. So, while there was a lot of bluster and lecturing at the press conference that the mission organised before its departure I suspect that it could soon be eating its own words.

This writer has argued in these columns before that, contrary to conventional wisdom, one would not be surprised if the Fund, succumbing to US pressure, eventually drafts a relatively soft programme for Pakistan.

If we cooperate and play ball by facilitating their safe and early exit from Afghanistan the Americans should be able to persuade the European members of the IMF board (who may get, in return, softened terms for Greece, etc.) to forge less stringent conditions for the new programme, although we would not get more than $5bn against the $8bn we would be repaying the IMF.

The writer is a former governor of the State Bank of Pakistan

 

[My-Analogous]

Don't think who is saying think what he is saying (Hazrat Ali R.A)

 

[xyxmt]

Sir why take so much effort ..to help some country who consider u there immortal enemy....whose purpose is to see ur destruction at any cost

Helping an enemy nation is same as betraying ur nation

Pakistani's strategic and planning Commission already studying the above article and pretty damn sure it will get us our of problems soon...thank you Start War for helping my country aka your enemy country

 

[kam83]

Pakistani's strategic and planning Commission already studying the above article and pretty damn sure it will get us our of problems soon...thank you Start War for helping my country aka your enemy country

did u mean "Out of problem" ...lollllll control u r emotion and then post

As far as Starting War to help ur country goes......we do things according to our preference .... that are benificial to us...Duniya gayi tel lene

U guys continue with "ur Destroying India with 1000 cut" plan ......

 

[niaz]

Reducing the fiscal deficit is another way of saying either collect more taxes or reduces your expenditure to balance the books; but don’t print money.

Controlling the amount of money in circulation is one of the main jobs of the State Bank and as an ex-Governor of the State Bank, the writer is himself is partly responsible for the adverse economic health of the country.

Right or wrong, I still hope that IMF doesn’t provide bailout package forcing Pakistanis to tighten their belt else go the dogs. That is the only way Pakistanis would ever learn to stand on their feet.

 

[xyxmt]

did u mean "Out of problem" ...lollllll control u r emotion and then post

As far as Starting War to help ur country goes......we do things according to our preference .... that are benificial to us...Duniya gayi tel lene

U guys continue with "ur Destroying India with 1000 cut" plan ......

smart guy you caught my one spelling mistake but went on to continue answering my second spelling mistake "start War", Star Wars "The poster" I was referring to, Start War didnt even make sense in that sentence but you are a smarter man

 

[kam83]

smart guy you caught my one spelling mistake but went on to continue answering my second spelling mistake "start War", Star Wars "The poster" I was referring to, Start War didnt even make sense in that sentence but you are a smarter man

for me none of u ppl make sense......