ISLAMABAD: Opposition parties on Monday slashed the Pakistan Tehreek-e-Insaf (PTI) government over the new $6 billion International Monetary Fund (IMF) bailout package, observing that the agreement will result in a tsunami of inflation.
Pakistan Muslim League-Nawaz (PML-N) and Pakistan People’s Party (PPP) leaders raised concerns over the ailing economic condition. PML-N spokesperson Maryam Aurangzeb gave her two cents on Twitter while addressing the premier and said that: “Imran sahib (Mr Imran) you have handed over the country to IMF for $6 billion only.”
The former minister further noted that the “new taxes worth Rs1000 billion will be imposed” which will result in “dropping an inflation bomb on the underprivileged masses of the country”.
عمران صاحب آپ نے ملک کو صرف چھ ارب ڈالر میں آئی آیم ایف کے حوالے کردیا
آئی ایم ایف کا آئی ایم ایف سے معاہدہ کامیاب ہو گیا اور عوام پہ مہنگائی کا بم گرا دیا گیا
غریبوں کے کئے تمام ریلیف ختم ، گیس ، بجلی اور کھانے کی اشیا مزید مہنگی @pmln_org
— Marriyum Aurangzeb (@Marriyum_A) May 12, 2019
Former finance minister Miftah Ismail also voiced his concerns over the bailout package in a series of tweets.
The PTI govt and IMF have reached a deal. My quick and initial assessment of the deal shows these items to be significant.
1) Free float of the Pakistani rupee.
2) Reducing primary deficit to 0.6% of GDP next year. This year it will be about 2.5% of GDP. So they require Rs 800— Miftah Ismail (@MiftahIsmail) May 12, 2019
billion in new taxes. Accounting for inflation, next year would require additional taxes of over Rs 1000 billion, which is over 25% increase. This will cause widespread hardship, unemployment and inflation.
3) The slowdown of the economy will increase poverty. So BISP spending— Miftah Ismail (@MiftahIsmail) May 12, 2019
will go up, otherwise we will see massive increase in malnutrition and stunting. Rich people: please do more charity this year.
4) IMF wants letter from other donors that they will give more loans. This means that China will have to assure IMF that it will re-roll its loans.— Miftah Ismail (@MiftahIsmail) May 12, 2019
5) IMF mentions progress towards money laundering and counter financing of terrorism. The suggests that the Fund will now also look at FATF decisions.
6) The Fund statement doesn’t mention that prices of gas and electricity will go up, but insiders say that’s also been agreed.— Miftah Ismail (@MiftahIsmail) May 12, 2019
7) The Fund statement also doesn’t directly mention interest rate hike but that’s also expected.
PTI has ruined the economy really fast due to its incompetence. The PM was right to fire the FM. But now this will mean that the adjustment programme will be very hard for the poor— Miftah Ismail (@MiftahIsmail) May 12, 2019
and the middle classes. During the last IMF programme under PMLN we were able to increase GDP growth and reduce inflation. I hope PTI can emulate our example. But it looks that they won’t be able to increase growth. I just hope they are able to control inflation
— Miftah Ismail (@MiftahIsmail) May 12, 2019
PPP leader Sherry Rehman took a jibe at the government and said that “the journey from #TabdeeliSarkar to #GhulamiSarkar is now complete”.
The journey from #TabdeeliSarkar to #GhulamiSarkar is now complete. Other Govts ran IMF programs but nothing like the creeping coup of the economy that’s been happening since new Govt came in. “We will hang ourselves but never go to the IMF” ringing in all our ears… https://t.co/1XoIw1ITlV
— SenatorSherryRehman (@sherryrehman) May 12, 2019
Foreign Minister Shah Mehmood Qureshi on Sunday said the Pakistan Tehreek-e-Insaf (PTI) government “tried its best” to resolve the country’s economic woes without the International Monetary Fund’s assistance.
Sharing his thoughts with journalists following a $6 billion loan agreement between Pakistan and the IMF, the PTI stalwart said the government pursued the global lender to soften its terms and conditions for the financial package.
“When the PTI came to power, there was a difference of $19 billion in imports and exports, he noted, adding that there was no investment or avenues for the creation of jobs,” he said while adding that “the PTI government tried its best to settle financial issues without the IMF”.
Qureshi asserted the PTI government had managed to reduce sales tax on petroleum products to 17 per cent from 56 per cent during the PML-N tenure and was striving hard to enhance the tax net base.
The past regimes remained dependent on indirect taxation, however, the incumbent government was trying to bring more people into the tax net as it would help reduce the burden on the common public, he said.
Pakistan and International Monetary Fund (IMF) on Sunday finalised the bailout package after months-long talks pertaining to the size of the bailout package as well as conditions attached to it.
Speaking to the media, Prime Minister’s Advisor on Finance Hafeez Sheikh had said that Pakistan and IMF have reached an agreement for a $6 billion bailout package under extended fund facility for a period of three years.
He said that the agreement will improve the debt situation and sent a positive signal to the world to attract foreign investment. He added that the IMF programme will provide an opportunity to bring structural changes to handle issues pertaining to loss-making state-owned enterprises, exports, and to enhance revenue.
Meanwhile, the IMF has also announced that it has reached a staff-level agreement on economic policies that could be supported by a 39-month Extended Fund Arrangement (EFF) for about US$6 billion, but the agreement is subject to approval by IMF management and Executive Board.
from Pakistan Today
No comments: