Pakistan has long been riven by economic crises and time and again the Bretton Woods institutions, like the International Monetary Fund (IMF) have bailed Pakistan out. While no one wants Pakistan – a country of 220 million with nuclear weapons – to default – like Sri Lanka – there are many who ask why the IMF keeps bailing out Pakistan.
In a recent column F.S. Aijazuddin asks why the IMF “behaves towards Pakistan like an indulgent aunt. It waits until Pakistan runs out of pocket money and then gives a handout with a homily on the need for prudence and self-control.”
If, as Aijazuddin asks, “the IMF’s justification for this liberality is to support Pakistan’s policies to support the economy and save lives and livelihoods and to lay the foundations for strong, job-rich, and long-lasting growth that benefits all Pakistanis” then “why ask many weak, jobless and long-suffering Pakistanis, has Pakistan not been able to wean itself off its addictive dependence on the IMF?”
Aijazuddin refers to an internal study from 2002 by the IMF’s Independent Evaluation Office (IEO) that “diagnosed Pakistan as a prolonged user, a habitué. It questioned the IMF’s relative generosity in granting waivers to Pakistan despite noncompliance with its conditions.”
If, as the columnist asks, nothing has changed since 1998 then maybe this program will go the way of the previous 22. And in a few years Pakistan will be back at IMF’s door for another loan.
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