Â Pakistanâ€™s promises to IMF in doubt as protests sap economy
Reuters: Anti-government protests that have gripped Islamabad since mid-August could throw off course economic reforms Pakistan promised to deliver in return for an IMF bailout, senior officials said, raising the risk of a sovereign rating downgrade.
The International Monetary Fund (IMF) saved Pakistan from possible default last September by agreeing to lend $6.6 billion over three years, conditional on reforms such as a longstanding pledge to privatise loss-making state companies.
There is no suggestion that the assistance, which is disbursed in tranches, is about to dry up.
â€śThe program is not in jeopardy at the moment,â€ť said a top economic adviser with direct knowledge of talks with the Fund. â€śThe IMF folk think that if we can wrap this crisis up in a week or so, things will remain on course and normal. But if it goes on any longer, then, yes, we will be in trouble.â€ť
Commerce Minister Khurram Dastgir Khan voiced concern that an IMF team had already cancelled a visit to Pakistan because of the protests that turned violent last week as Prime Minister Nawaz Sharif refused to resign. He said more than a year of efforts to fix the economy had â€śgone up in smokeâ€ť.
â€śThe government has very painstakingly been building a house of international confidence, and the foundation of this was the IMF package and abiding by our reformsâ€™ promises,â€ť the minister told Reuters. â€śBut ... our struggles of 14 months have gone up in smoke in a matter of 14 days. We are pushed to a point where we have to go back to the drawing board.â€ť