Pakistan On The Verge Of Inflationary Collapse - Pleads For Larger IMF Bailout

[Norwegian]

Pakistan On The Verge Of Inflationary Collapse - Pleads For Larger IMF Bailout

Tyler Durden's Photo
BY TYLER DURDEN
MONDAY, MAY 30, 2022 - 03:27 PM
Pakistan, a nuclear power with at least 165 warheads from short range to medium range, is facing potential economic collapse according to the country's Finance Minister, Miftah Ismail.

With an official inflation rate of over 13.37% (double the official CPI to get a more accurate picture of true price inflation), the 2nd fastest rising rate in Asia, Pakistan has sought relief from foreign debt obligations and an IMF bailout deal. Initial arrangements for a three year deal with the IMF began in 2019, but Pakistan says that deal, originally for $6 billion USD, is 'outdated' due to the covid pandemic and new global financial pressures. The nation now says it is in 'dire need' of at least $36 billion in order to stay afloat.



Pakistan is slated to pay back over $21 billion USD in foreign debt within the next fiscal year. It is also struggling with extensive food inflation and supply chain disruptions as the government seeks to import at least 3 million tons of wheat and 4 million tons of cooking oil to alleviate shortages.

This is yet another example of the spread of global inflation/stagflation that is going largely ignored by western media outlets. Nations like Pakistan with already weakened economic conditions are canaries in the coal mine; leading indicators of what is likely to happen throughout more affluent first world nations should current conditions continue.

With globalist institutions like the UN, the IMF, the BIS, World Bank and the WEF all predicting major food shortages this year, the mainstream media has been noticeably quiet when it comes to nations where the crisis is already bubbling to the surface.

The reason the instability in Pakistan is particularly concerning is because it is one of nine countries in the world (officially) with a nuclear arsenal, not to mention an ongoing border conflict with India which sparked two wars in 1947 and 1965, as well as a limited war in 1999. As economic instability rises so does public discontent and rebellion. By extension, political elites commonly offer war as a “release valve” for public anger and a distraction from financial pain. Otherwise, the potential for widespread civil unrest grows daily.

To be sure, Pakistan is not the only country facing these conditions today, it is one of many. However, unlike many African or South American nations where the effects of inflationary collapse remain mitigated to domestic concerns, a collapse in Pakistan could have international implications.

Beyond the threats associated with sinking economies and regional conflicts, the IMF has become the go-to loan shark, circling struggling nations when it smells blood in the water. As more and more countries face declines associated with inflation/stagflation, it is not conspiratorial to suggest that the IMF greatly benefits. As the world breaks down, more nations become beholden to the IMF debt structure until eventually they are owned lock, stock and barrel by a handful of banking elites.

ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

@Wood @maithil @UKBengali @Bilal9 @Bilal. @Patriot forever @farok84 @ziaulislam

 

[VCheng]

Pleads For Larger IMF Bailout

Why? Pakistan has another option - default.

 

[UKBengali]

Why? Pakistan has another option - default.

As not many people apart from China and maybe Saudi would ever lend Pakistan any money in the near future.

 

[Wood]

Pakistan On The Verge Of Inflationary Collapse - Pleads For Larger IMF Bailout

Tyler Durden's Photo
BY TYLER DURDEN
MONDAY, MAY 30, 2022 - 03:27 PM
Pakistan, a nuclear power with at least 165 warheads from short range to medium range, is facing potential economic collapse according to the country's Finance Minister, Miftah Ismail.

With an official inflation rate of over 13.37% (double the official CPI to get a more accurate picture of true price inflation), the 2nd fastest rising rate in Asia, Pakistan has sought relief from foreign debt obligations and an IMF bailout deal. Initial arrangements for a three year deal with the IMF began in 2019, but Pakistan says that deal, originally for $6 billion USD, is 'outdated' due to the covid pandemic and new global financial pressures. The nation now says it is in 'dire need' of at least $36 billion in order to stay afloat.



Pakistan is slated to pay back over $21 billion USD in foreign debt within the next fiscal year. It is also struggling with extensive food inflation and supply chain disruptions as the government seeks to import at least 3 million tons of wheat and 4 million tons of cooking oil to alleviate shortages.

This is yet another example of the spread of global inflation/stagflation that is going largely ignored by western media outlets. Nations like Pakistan with already weakened economic conditions are canaries in the coal mine; leading indicators of what is likely to happen throughout more affluent first world nations should current conditions continue.

With globalist institutions like the UN, the IMF, the BIS, World Bank and the WEF all predicting major food shortages this year, the mainstream media has been noticeably quiet when it comes to nations where the crisis is already bubbling to the surface.

The reason the instability in Pakistan is particularly concerning is because it is one of nine countries in the world (officially) with a nuclear arsenal, not to mention an ongoing border conflict with India which sparked two wars in 1947 and 1965, as well as a limited war in 1999. As economic instability rises so does public discontent and rebellion. By extension, political elites commonly offer war as a “release valve” for public anger and a distraction from financial pain. Otherwise, the potential for widespread civil unrest grows daily.

To be sure, Pakistan is not the only country facing these conditions today, it is one of many. However, unlike many African or South American nations where the effects of inflationary collapse remain mitigated to domestic concerns, a collapse in Pakistan could have international implications.

Beyond the threats associated with sinking economies and regional conflicts, the IMF has become the go-to loan shark, circling struggling nations when it smells blood in the water. As more and more countries face declines associated with inflation/stagflation, it is not conspiratorial to suggest that the IMF greatly benefits. As the world breaks down, more nations become beholden to the IMF debt structure until eventually they are owned lock, stock and barrel by a handful of banking elites.

ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

@Wood @maithil @UKBengali @Bilal9 @Bilal. @Patriot forever @farok84 @ziaulislam

Pakistan is too big to fail for global players. So there will be no collapse. The title of the thread and the article itself is click bait.

Thus far, I've seen the following administrative accomplishments of PDM as mentioned in this forum:

a) Rollback of Imran's fuel subsidy at expense of political capital despite threats. This is likely to secure IMF funding which is the bedrock requirement for most other bilateral lenders.
b) China has reportedly agreed for $2.5 billion funding
c) Saudi has reportedly agreed to restructure the $3 billion debt repayment that is due (after General Bajwa's intervention?)
d) Hike interest rate to fully utilize the monetary powers of central bank to combat inflation (deliberately slow down the unstainable economic growth).

Considering that the administration has only had a couple of months, this is admirable. Only complaint so far is the initial flip flop from the administration in rolling back Imran's fuel subsidy. It would have cost the exchequer billions of PKR and has to be captured back in revenue through higher taxes elsewhere. In fact, I think IMF will try to force PDM to accommodate this in their next budget.

PS: I remember that OP drubbed me as a 'Patwari' and commanded that I should not participate in Pakistani affairs. So, why mention me here?

 

[khansaheeb]

Pakistan On The Verge Of Inflationary Collapse - Pleads For Larger IMF Bailout

Tyler Durden's Photo
BY TYLER DURDEN
MONDAY, MAY 30, 2022 - 03:27 PM
Pakistan, a nuclear power with at least 165 warheads from short range to medium range, is facing potential economic collapse according to the country's Finance Minister, Miftah Ismail.

With an official inflation rate of over 13.37% (double the official CPI to get a more accurate picture of true price inflation), the 2nd fastest rising rate in Asia, Pakistan has sought relief from foreign debt obligations and an IMF bailout deal. Initial arrangements for a three year deal with the IMF began in 2019, but Pakistan says that deal, originally for $6 billion USD, is 'outdated' due to the covid pandemic and new global financial pressures. The nation now says it is in 'dire need' of at least $36 billion in order to stay afloat.



Pakistan is slated to pay back over $21 billion USD in foreign debt within the next fiscal year. It is also struggling with extensive food inflation and supply chain disruptions as the government seeks to import at least 3 million tons of wheat and 4 million tons of cooking oil to alleviate shortages.

This is yet another example of the spread of global inflation/stagflation that is going largely ignored by western media outlets. Nations like Pakistan with already weakened economic conditions are canaries in the coal mine; leading indicators of what is likely to happen throughout more affluent first world nations should current conditions continue.

With globalist institutions like the UN, the IMF, the BIS, World Bank and the WEF all predicting major food shortages this year, the mainstream media has been noticeably quiet when it comes to nations where the crisis is already bubbling to the surface.

The reason the instability in Pakistan is particularly concerning is because it is one of nine countries in the world (officially) with a nuclear arsenal, not to mention an ongoing border conflict with India which sparked two wars in 1947 and 1965, as well as a limited war in 1999. As economic instability rises so does public discontent and rebellion. By extension, political elites commonly offer war as a “release valve” for public anger and a distraction from financial pain. Otherwise, the potential for widespread civil unrest grows daily.

To be sure, Pakistan is not the only country facing these conditions today, it is one of many. However, unlike many African or South American nations where the effects of inflationary collapse remain mitigated to domestic concerns, a collapse in Pakistan could have international implications.

Beyond the threats associated with sinking economies and regional conflicts, the IMF has become the go-to loan shark, circling struggling nations when it smells blood in the water. As more and more countries face declines associated with inflation/stagflation, it is not conspiratorial to suggest that the IMF greatly benefits. As the world breaks down, more nations become beholden to the IMF debt structure until eventually they are owned lock, stock and barrel by a handful of banking elites.

ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

@Wood @maithil @UKBengali @Bilal9 @Bilal. @Patriot forever @farok84 @ziaulislam

It's like being whipped by bdsm sex whip flogger and asking for more. No shortage of corrupt fools in Pakistan.

 

[lastofthepatriots]

Beggar can’t be chooser

 

[Pak Nationalist]

Pakistan On The Verge Of Inflationary Collapse - Pleads For Larger IMF Bailout

Tyler Durden's Photo
BY TYLER DURDEN
MONDAY, MAY 30, 2022 - 03:27 PM
Pakistan, a nuclear power with at least 165 warheads from short range to medium range, is facing potential economic collapse according to the country's Finance Minister, Miftah Ismail.

With an official inflation rate of over 13.37% (double the official CPI to get a more accurate picture of true price inflation), the 2nd fastest rising rate in Asia, Pakistan has sought relief from foreign debt obligations and an IMF bailout deal. Initial arrangements for a three year deal with the IMF began in 2019, but Pakistan says that deal, originally for $6 billion USD, is 'outdated' due to the covid pandemic and new global financial pressures. The nation now says it is in 'dire need' of at least $36 billion in order to stay afloat.



Pakistan is slated to pay back over $21 billion USD in foreign debt within the next fiscal year. It is also struggling with extensive food inflation and supply chain disruptions as the government seeks to import at least 3 million tons of wheat and 4 million tons of cooking oil to alleviate shortages.

This is yet another example of the spread of global inflation/stagflation that is going largely ignored by western media outlets. Nations like Pakistan with already weakened economic conditions are canaries in the coal mine; leading indicators of what is likely to happen throughout more affluent first world nations should current conditions continue.

With globalist institutions like the UN, the IMF, the BIS, World Bank and the WEF all predicting major food shortages this year, the mainstream media has been noticeably quiet when it comes to nations where the crisis is already bubbling to the surface.

The reason the instability in Pakistan is particularly concerning is because it is one of nine countries in the world (officially) with a nuclear arsenal, not to mention an ongoing border conflict with India which sparked two wars in 1947 and 1965, as well as a limited war in 1999. As economic instability rises so does public discontent and rebellion. By extension, political elites commonly offer war as a “release valve” for public anger and a distraction from financial pain. Otherwise, the potential for widespread civil unrest grows daily.

To be sure, Pakistan is not the only country facing these conditions today, it is one of many. However, unlike many African or South American nations where the effects of inflationary collapse remain mitigated to domestic concerns, a collapse in Pakistan could have international implications.

Beyond the threats associated with sinking economies and regional conflicts, the IMF has become the go-to loan shark, circling struggling nations when it smells blood in the water. As more and more countries face declines associated with inflation/stagflation, it is not conspiratorial to suggest that the IMF greatly benefits. As the world breaks down, more nations become beholden to the IMF debt structure until eventually they are owned lock, stock and barrel by a handful of banking elites.

ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

@Wood @maithil @UKBengali @Bilal9 @Bilal. @Patriot forever @farok84 @ziaulislam

Bro, we must also thank your leader IK for the subsidies that broke the bank in his last months in power. He left political mines for his opponents after reading the writing on the wall. How so very patriotic. A spoilt brat who would rather have his belongings burn than be shared with someone else. People be d*cked, two figs the great langarkhana launching nationalist messiah gives about them.

 

[Pak Nationalist]

The country needs a charter of economy more than any self-proclaimed messiah. Each government since the Musharraf years has broken the bank as the elections neared (in the case of PTI's govt formed by a handful of seats cobbled together by the establishment assets, as the departure signaling writing on the wall was clear). This fiscal indiscipline coupled with overheating of the economy by pumping unsustainable growth (leads to uncontrolled imports growth) towards the end of each gov's tenure leaves behind a perfect storm for a new govt that has to plead with IMF to bail the country out.

The IMF's terms have become stringent with each next knock on its doors as we are habitual loan seekers who do not put our house in order and look for electoral victories based on artificial growth rather than making the country self-reliant. This could only happen once a broad-based national consensus on do's and don'ts in economic management is developed among the political stakeholders. I am not even factoring in the biggest destabilizing force in Pakistani politics i.e. the establishment, in this equation.

 

[Norwegian]

The country needs a charter of economy more than any self-proclaimed messiah. Each government since the Musharraf years has broken the bank as the elections neared (in the case of PTI's govt formed by a handful of seats cobbled together by the establishment assets, as the departure signaling writing on the wall was clear). This fiscal indiscipline coupled with overheating of the economy by pumping unsustainable growth (leads to uncontrolled imports growth) towards the end of each gov's tenure leaves behind a perfect storm for a new govt that has to plead with IMF to bail the country out.

As we have seen, IMF's terms have become stringent with each next knock on its doors as we are habitual loan seekers who do not put our house in order and look for electoral victories based on artificial growth rather than making the country self-reliant. This could only happen once a consensus on do's and don'ts is developed among the political stakeholders. I am not even factoring in the biggest destabilizing force in Pakistani politics i.e. the establishment, in this equation.

Well done.

 

[lastofthepatriots]

Bro, we must also thank your leader IK for the subsidies that broke the bank in his last months in power. He left political mines for his opponents after reading the writing on the wall. How so very patriotic. A spoilt brat who would rather have his belongings burn than be shared with someone else. People be d*cked, two figs the great langarkhana launching nationalist messiah gives about them.

Your post is mostly bullshit and I didn’t really finish reading it, but since you quoted the article I looked at the name of the author and my mind instantly went to fight club.

I guess your post wasn’t completely useless.

 

[Norwegian]

Bro, we must also thank your leader IK for the subsidies that broke the bank in his last months in power.

That subsidy came from the budget and would have lasted until new budget in June 2022

 

[Pak Nationalist]

That subsidy came from the budget and would have lasted until new budget in June 2022

Budget deficit to touch record Rs4.3tr | The Express Tribune

Gap is widening despite reduction of Rs200b in federal development budget

tribune.com.pk

4.3 trillion DEFICIT budget you mean?

 

[mulj]

With production of 4mill tons of wheat and oil localy you would not have any debt, i would concentrate majority of economic efforts and projects around those two figures for decade at least.

 

[koolio]

Nobody is trusting the imported government, that is the reason they are struggling to get aid and bailouts,

Establishment just signed its own death warrant in bringing crooks back to power hence economy is taking a free fall in negative territory.

 

[Pak Nationalist]

Your post is mostly bullshit and I didn’t really finish reading it, but since you quoted the article I looked at the name of the author and my mind instantly went to fight club.

I guess your post wasn’t completely useless.

The usual verbal onslaught of a political partisan. Best not to engage altogether if you are incapable of deconstructing what you disagree with objectively. Thanks for wasting your time and my writing that.