Pakistan takes $5bn IMF bail-out after allies refuse funds

[Eugene]

Source: The Guardian

Pakistan takes $5bn IMF bail-out after allies refuse funds

Saeed Shah in Islamabad
The Guardian, Thursday October 23 2008

Pakistan has sought an emergency bail-out from the
International Monetary Fund, a humiliating step
forced on Islamabad after allies refused to come up
with cash to prevent the country going bust.

The IMF confirmed yesterday that Pakistan had sought
funds to meet balance of payments difficulties. It
is expected to provide $5bn (about £3bn) or more for
the coming year, with billions more for subsequent
years.

Pakistan's finance minister, Shaukat Tareen, said
recently that going to the IMF was his "plan C", but
Islamabad has been stung by rebuffs from its closest
international partners - China, the US and Saudi
Arabia - leaving it with few choices. Past IMF
programmes, requiring Pakistan to agree to austerity
measures, were deeply unpopular. The previous regime,
of President Pervez Musharraf, had trumpeted its
break from this source of finance.

-snip-

Pakistan's foreign exchange reserves will run out
within about seven weeks, meaning that it will not
be able to meet external debt payments, making it
bankrupt. The restoration of democracy, with
elections in February, coincided with an economic
collapse that has sent inflation soaring and the
rupee plunging. Islamabad had hoped that, as a
frontline state in the "war on terror", allies
would come to its aid, as a bankrupt country would
not be able to fight the Taliban and al-Qaida.

-snip-

Read more: http://www.guardian.co.uk/world/2008/oct/23/pakistan-imf

[Demeter]

1. So Much for Allies, Brotherly Love and Common Interests

[unkachuck]

2. I'm disappointed.....

....in Pakistan, haven't they learned anything from North Korea?....just threaten to sell a few nukes and you'll get all the attention and help you need....

[cosmicone]

3. I hope the IMF

forces Pakistan to cut military spending drastically and spend more on social programs and modernization of its society from the jihad-taliban mentality to a more progressive, inclusive and peaceful one.