IMF loan a cure: President Zardari

[pkpatriotic]

IMF loan a cure: President Zardari
Sunday, 02 Nov, 2008


File photo: President Zardari inspects a guard of honor.

JEDDAH: President Asif Ali Zardari has said that while cash-strapped Pakistan is still averse to resorting to International Monetary Fund (IMF) aid, the country must consider the IMF option as a cure for its ailing economy.

Zardari is to visit Saudi Arabia on Tuesday for talks with King Abdullah Bin Abdul Aziz, to solicit support for the Friends of Pakistan initiative and the oil-facility requested by Pakistan.

Speaking to Saudi Gazette in an exclusive interview ahead of the visit, Zardari said, ‘Saudi Arabia has always provided assistance to Pakistan in difficult times.’

And these are very difficult times for Pakistan, which needs up to $4.5 billion to deal with a balance of payments crisis, raising the prospect that the violence-hit country will default on its foreign debts.

‘I will solicit Saudi support for the Friends of Pakistan initiative,’ the President said. ‘I sincerely hope that with the steadfast support of the Saudi government, it will achieve the desired objectives.’

The Friends of Pakistan will meet in Abu Dhabi on Nov. 17 to decide on economic aid for the country, an ally in the global ‘war on terror.’

Pakistan’s friends include Britain, France, Germany, the United States, China, the United Arab Emirates, Canada, Turkey, Australia and Italy plus the United Nations and the European Union.

Additionally, ‘Pakistan is supported through a series of negotiations by various world economic bodies – World Bank, Islamic Development Bank, Asian Development Bank and the UK’s Department for International Development,’ Zardari said, suggesting that options remain open for his country to avoid a loan from the IMF.

‘Getting aid from the IMF is our last option,’ Zardari said. However, he added after a pause: ‘Actually, we must consider the IMF option as a medicine that will ultimately cure our ailing economy.’

An IMF loan is often tied to stringent conditions, chief of which is elimination of subsidies.

In September, the IMF recommended that Pakistan’s fiscal deficit be reduced to 4.7 per cent of the GDP and electricity subsidies be eliminated.

And that’s Zardari’s concern. ‘In just five years, our oil bill has increased from $3 billion to over $12 billion, thus creating pressures on our balance of payments, he said. Such an increase is also creating difficulties for our budget as we have tried to protect our people from the rising cost of energy by subsidizing fuel and electricity in the given limits of the budget.’

If Pakistan cuts its electricity subsidies as sought by the IMF, its energy bill – for mainly oil – will get passed on to the people, leading to price rises.

‘Global food inflation is hovering between 35 and 40 per cent and Pakistan is no exception,’ Zardari pointed out while explaining his government’s struggle to control food prices in the midst of various initiatives to return Pakistan on a high growth trajectory.

‘Unfortunately, for decades Pakistan was being managed by people who had no perspective or imagination,’ Zardari said. ‘Otherwise, Pakistan is rich in all sorts of resources.’

 

[A.Rahman]

He sold us to IMF again, now sit back and see how our forces are cut

 

[Black Stone]

Some of the loan will go to his pocket?.

 

[Always Neutral]

Some of the loan will go to his pocket?.

Dear Black Stone,

How did you come to that brilliant deduction ? Are you aware how IMF disburses its loans ? Any reason why the IMF handout was Plan C and not A or B ?

You need to re-search more before making such brilliant deductions.

IMF route is the most unpopular route a country takes as it ensures total transparency and avoids popular but disastrous subsidies and hence the the politicians hate IMF.

Regards

 

[Always Neutral]

He sold us to IMF again, now sit back and see how our forces are cut

How has he sold you. Its not his fault if China and Saudis or the rest of the ummah did not bail you out ?

IMF loans are for the country and not for the Army. No one is stopping you from using your own internal revenue for the Armed Forces.

Regards

 

[Always Neutral]

Pakistan halts building of army HQ as bankruptcy edges closer - Telegraph

Pakistan halts building of army HQ as bankruptcy edges closer
Pakistan has been forced to halt the construction of lavish new military headquarters in Islamabad as the nuclear-armed nation desperately fights to stave off bankruptcy.

I think this is the first effect of IMF. Cut down of wastefull expenditure.

Regards

 

[Black Stone]

Dear Black Stone,

How did you come to that brilliant deduction ? Are you aware how IMF disburses its loans ? Any reason why the IMF handout was Plan C and not A or B ?

You need to re-search more before making such brilliant deductions.

IMF route is the most unpopular route a country takes as it ensures total transparency and avoids popular but disastrous subsidies and hence the the politicians hate IMF.

Regards

Calm down AN. Why so serious? I shall put a smiley face next time.

 

[Always Neutral]

Calm down AN. Why so serious?

I thought this was a serious discussion forum ?

Regards

 

[Black Stone]

I thought this was a serious discussion forum ?

Regards

I shall put a smiley face next time.

 

[A.Rahman]

How has he sold you. Its not his fault if China and Saudis or the rest of the ummah did not bail you out ?

IMF loans are for the country and not for the Army. No one is stopping you from using your own internal revenue for the Armed Forces.

Regards

Internal revenue of about $60 million sits in Zardari's personal swiss bank account. I say release that money first before signing IMF death warrant.

 

[blain2]

Dear Black Stone,

How did you come to that brilliant deduction ? Are you aware how IMF disburses its loans ? Any reason why the IMF handout was Plan C and not A or B ?

You need to re-search more before making such brilliant deductions.

IMF route is the most unpopular route a country takes as it ensures total transparency and avoids popular but disastrous subsidies and hence the the politicians hate IMF.

Regards

The problem with WB and IMG money in general in the 3rd world is that its not skimmed at the top. Its when you bring in local contractors and labour and project management to get things done. Whenever someone from outside is brought in and deputed, there compensation itself is insane and eats into the funding. This is something that has been going on ever since these entities started operating. They always get their money back with interest of course, but nations are stuck with paying back loans which rarely do anything good for them. Pakistan and the rest of the third world require massive internal transparency before an external program can work there.

Not being pessimistic here, but just stating the reality in the third world.

 

[Kumar]

Internal revenue of about $60 million sits in Zardari's personal swiss bank account. I say release that money first before signing IMF death warrant.

I Think its just an assumption regarding the $60 million. unless the swiss court declares some body account is fraud or in violation there is no way you can identify the exact amount from these accounts.thats what the application rule says. swiss lives because of this money. there is no other big revenue for them.

 

[Always Neutral]

Internal revenue of about $60 million sits in Zardari's personal swiss bank account. I say release that money first before signing IMF death warrant.

Why should he ? As most patriotic Pakistani's he will lend it to IMF who will loan it to Pakistan ? Now the question is where did Jinnah go wrong when he created Pakistan and where have the true Pakistanis gone ?

I am taking it for granted that your USD 60 million figure is right.

Regards

 

[Always Neutral]

The problem with WB and IMG money in general in the 3rd world is that its not skimmed at the top. Its when you bring in local contractors and labour and project management to get things done. Whenever someone from outside is brought in and deputed, there compensation itself is insane and eats into the funding. This is something that has been going on ever since these entities started operating. They always get their money back with interest of course, but nations are stuck with paying back loans which rarely do anything good for them. Pakistan and the rest of the third world require massive internal transparency before an external program can work there.

Not being pessimistic here, but just stating the reality in the third world.

I agree Blain but its atleast better for the local contractor to make money on small scales than a blank cheque given to Zardari by IMF. Also its Plan C (IMF Loan) which finally was the only option.

I know you won't like the comparison between USA vs USSR rivalry which led to the collapse of USSR but Pakistan has also done the same with India without making its basic human resources /industry strong and hence they find themselves staring at the end of the barrel just like USSR 10 years ago.

One must ask why is China also showing its back to Pakistan and preferring to invest in US and Europe than in Pakistan ? Maybe they know something which the ordinary Pakistani does not know.

BTW if its any comfort the Pakistani driver who drove me yesterday feels this is all a drama by Zardari and is happily sending part of his wages to Lahore on a weekly basis.

Regards

Regards

 

[pkpatriotic]

To the poorhouse in a BMW
We are not living through the last days of the crumbling Mughal Empire when state honours were doled out because the state had nothing else to give. And why are our people always seeking favours that they do not always deserve?

The great American wit and folk hero Will Rogers once said of his country back in the twenties that America was a nation going to the poorhouse in a limousine. It may or may not have been true of the United States, but it certainly is of Pakistan today.

For a country which may be only days away from default on its international debt repayments, whose foreign exchange reserves are barely enough to pay for its imports for six to seven weeks, where inflation has been running at a spiralling rate — now close to 30 percent and rising — we are acting as if there were no tomorrow. Such a country, like a person or a company that is about to end up on the street, is not taken seriously by anyone.

The graver our economic condition gets, the more statements our economic managers make. Every statement in some way either contradicts the one made earlier or says something entirely different. While we all wish Mr S Tareen a long life, he should not tempt fate by declaring every now and then that such and such will occur “on my dead body”. I should also caution him that Weight Watchers Inc has an eye out for him and unless he wants to live on carrot juice for the next six months, he should give that outfit a wide berth.

A friend who has just returned from Pakistan is still amazed at the lack of any clear recognition that we were up that certain creek without an oar. The overall national mood is one of denial, he says. The good things of life, including fast cars, foreign visits at public expense and all that big money can buy, remain the principal attractions. Those who were promising the nation as many rescue plans as the alphabet has letters, have finally landed in the lap of that much-maligned agency which, as was to be expected, is laying down conditions that will leave little wiggle room.

How did we come to this sorry pass? It is “the earlier government’s doing”, we are told. But no one has either the time or the inclination to listen to what is universally known as the oldest excuse in the world.

The Friends of Pakistan, that strange group assembled under one roof by the Americans and perfidious Albion, has so far made no more than cooing noises. With the Saudis showing diffidence, one can only wonder how far the half promises made to Pakistan will go. No one has a red cent to spare given the worldwide economic crunch. And the world does not owe us a living, hard though we find that to accept.

How can realism dawn in a country where everyone is convinced that the presidential election in the United States is being held to decide what to do about Pakistan? The world is a wide, wide place and there are others on this planet who too need assistance but they don’t demand it as a matter of right like we do. The world has run out of sympathy, especially for those who become victims of their own unthinking policies and actions.

In any case, while we slide towards the economic abyss, there is no let up in our desire for high living. Are we the last of the world’s big spenders? Why, for instance, did the prime minister spend five days in Turkey? What for? What good did it do to Pakistan and in what way did it ease our situation? Did it cause the price of flour to become affordable or did it reduce the duration of power breakdowns? Did it bring in the money we need if we are not to default and become an international economic pariah, the basket-case of South Asia?

Consider the register of appointments to high, lucrative offices that grows thicker by the week. The prime minister now has an adviser on textiles. Why did he need an adviser on textiles? Aren’t the ministries of the government set up to deal with just such subjects not good enough? Has the national association of textile manufacturers ceased to exist or is it that suddenly its collective brain has been wiped clean of all wisdom and it no longer is able to advise the government how best it can help the industry, which is Pakistan’s export mainstay? Will the new adviser be successful in persuading the United States to ease the restrictions it has placed on the import of our textiles?

Several governments have failed to have that brought about, so maybe this gentleman is the secret weapon we have been hiding all this time, and he will soon have the US Department of Commerce taking orders from a section officer in his office. We wait in hope.

And then there are the roving ambassadors whose number, at the going rate, is certain to exceed that of the regular kind the rest of the world makes do with. The latest addition is a roving ambassador to be appointed in Washington. The gentleman chosen is an affable and hospitable businessman but how is he going to be able to be of any use or utility when there already is an ambassador here?

We are not living through the last days of the crumbling Mughal Empire when state honours were doled out because the state had nothing else to give. And why are our people always seeking favours that they do not always deserve? Even if the new, incoming government makes someone an offer, why can’t some at least decline gracefully?

Roving ambassadors are utterly and totally unnecessary. For instance, the one being appointed here in Washington will have nowhere to roam except from his Maryland home to the District of Columbia. Until recently, if the government had a special message that it wanted personally delivered to another government, it would pick out one of the serving diplomats as special envoy, who would proceed to the destination indicated, deliver his message as instructed and return home to resume his former position.

One of Pakistan’s ablest diplomats, Riaz H Khokhar, I know for a fact, has undertaken some of these delicate assignments without fanfare and with the discretion that the task demands. Can someone kindly explain to me what the six or eight or God knows how many roving ambassadors so far appointed have accomplished? Courtesy to—Khalid Hasan

QUOTE:
The addition of 40 ministers in cabinet is showing the vision and loyality of Zardari & co............there would be arround Rs 10 million /year per minister expense other then 40-50 Million in different other heads additionally in the name of territory's development funds (which never develope as yet during last 60 years. as such almost Rs: 50 -60 million /year (on record, while there may be a numerous unlimited amount from kick backs and misuse of authorities) for each minister, it can now imigine about the heavy load on the treasure of the country which is already at the verge of crucial economic crunch. I rest my case.

I think the following para of the title post for Zardari statement is overlooked by friends here to comments:

Unfortunately, for decades Pakistan was being managed by people who had no perspective or imagination,’ Zardari said. ‘Otherwise, Pakistan is rich in all sorts of resources.’

Kehney mein kia jata hey..............
What a vision and perspectives of good governed management of Zadari and his ruling teams have it's self explainatory by above mentioned article with my comments.