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Pakistan

Web Desk
April 6, 2021

PM Imran Khan to 'personally talk' to IMF head over aid money conditions

Pakistan

Web Desk
Tue, Apr 06, 2021

Prime Minister Imran Khan addresses the launch event of the National Human Development Report (NHDR) on Pakistan, compiled by the United Nations Development Programme (UNDP), in Islamabad, Pakistan, April 6, 2021. Geo News/Screengrab via The News

ISLAMABAD: Prime Minister Imran Khan said Tuesday he would "personally talk" to International Monetary Fund Managing Director Kristalina Georgieva about the conditions imposed on developing countries over aid money.

PM Imran Khan's comments came during his address at the launch event of the National Human Development Report (NHDR) on Pakistan — compiled by the United Nations Development Programme (UNDP) — in Islamabad.

"We're going to speak to the IMF because we see disruptions ahead," the premier said. "Just when our economy was recovering and all the indicators were positive [but] unfortunately, we will now have to review the situation and [likely introduce] a new Ehsaas programme.

"In Pakistan, our service industry has been really badly hurt and now, with this third wave [of the novel coronavirus], we will have to give incentive packages," he added.

PM Imran Khan further mentioned that the time was ripe to talk about a second aid package.

"I think it's time for a second package and we will obviously talk to the IMF and I think that the head of the IMF realises — and I've read her statement — that this is a very unique situation and you cannot suppress demand.

"You cannot impose conditions when people have already suffered. I will personally talk to her," he vowed.

Referring to Dr Hafeez Pasha, Pakistan's former finance minister and the former assistant secretary-general of the UN who was also present in the meeting, the PM said the UNDP report clearly stated that poor people — who are "the most affected by the coronavirus lockdowns everywhere in the world" — need to be protected.

"We will be talking to them and I look forward to reading in detail your suggestions [on] how we can protect the most vulnerable section of our society."

Elite capture 'not just the problem of Pakistan'

Speaking of the UNDP's report on Pakistan, the premier said it pointed out the ways the inequality hurt people and localities and, therefore, it would be helpful to his government, the main concern of which "is to lift our people out of poverty".

It highlighted "the areas and the people who have been left behind, the situation of the minorities, the transgender" community, he said, adding that to him, a civilised society was defined by the way it looked after the weaker section of the population and not by how the elites' lifestyle.

"It is defined by how [the society and the government are] planning to reduce this inequality," he said.

"The  elite capture is not just the problem of Pakistan... it's the problem of almost all the developing world, it's also of course a problem within the richer countries," the premier added, citing a study that showed that a select group of the world's richest people had accumulated as much wealth as the rest of the 3.5 billion in the world.

PM Imran Khan termed the figures as "shocking", saying there "has to be something wrong with the world order where such inequality exists and on one side such opulence of wealth that can never be spent in 10 life times and on the other hand you have extreme poverty".

The COVID-19 pandemic, in addition, had made poor people poorer so much so that more had gone below the poverty line. "In fact, some of the rich people have gotten richer during this coronavirus pandemic in the last one year," he added.

Dollars leaving a country affect jobs, currency

The prime minister went on to refer to a report by the International Financial Accountability, Transparency and Integrity (FACTI) panel — set up by UN Secretary-General Antonio Guterres — that revealed how "every year, one trillion dollars leave developing countries into tax havens or into properties in richer countries and that seven trillion dollars of this poor countries' money laundered out of their country is parked in safe tax havens".

"The fact is the reason behind this huge inequality in this world and huge poverty [is] when this sum of money leaves poor countries, employment is created in the countries it is destined for so the poor countries are not only deprived of the employment that this money could provide, not only does it also create poverty because this is the money that could be spent on human development but it also affects the currency.

"When so many dollars leave the poor countries, the currency gets affected and when the currency gets affected, when it devalues, it causes more poverty or inflation.

"This is a vicious cycle [continues] going on and unless something is done about it, I’m scared that the richer countries will have to build these walls to keep these economic immigrants out who will be trying desperately risking their lives to get to the richer countries," the PM opined.

Sugar is 'like the dessert of the poor family'

PM Imran Khan lamented that rich countries had no incentive to stop the outflow of illicit money from the poor countries "because they came from it".

The premier lauded his own government as well, saying it was the first one to go after "cartels".

"No one in our history has gone after the most powerful sugar cartels [which] jack up the sugar prices. Sugar is consumed among poor people the most because it's like the dessert of the poor family, [for] the children in poor families, sugar is everything."

The cartels, which "are all very powerful and politically connected", make huge profits on sugar "because it's consumed by the masses", he said, vowing to once again strengthen the Competition Commission of Pakistan (CCP).

'Greatest' Khyber Pakhtunkhwa

Speaking of the performance of Pakistan's provinces, the prime minister said he was "very proud" about Khyber Pakhtunkhwa — "a province that was devastated when, in 2013, we took over".

The province, he noted, "was devastated by the war on terror, there were bomb attacks going on, people had migrated from KP to Islamabad and other cities because of the danger to their lives and the insecurity".

He lauded the report for stating that Khyber Pakhtunkhwa "reduced its poverty the greatest and developed its human beings the greatest", as well as the fact that "it has almost caught up with Punjab, so that's a source of great satisfaction for my government".

PM Imran Khan also commended Dr Sania Nishtar, his special assistant on Poverty Alleviation and Social Safety, for the PTI government's flagship Ehsaas programme over the past year.

Aid disbursement in Pakistan better than Lebanon

The PTI government disbursed "this huge amount of money in a short space of time and when no one could say there was any sort of political distribution", he said, adding that he was glad Pakistan was better than Lebanon where "people were out on the streets and they felt the money distributed during COVID-19 was distributed on a political basis".

"When we look at the United States with a population of 330 million, they distributed almost $4 trillion and [for] our population of 220 million, we've barely [managed an] $8-billion total incentive package," he observed.

The premier also made remark about Pakistan's current COVID-19 situation, saying: "We're now having probably a very scary third wave and, in some ways, it's more scary than the first wave.

"Second wave wasn't that bad," he said.

'Direct subsidies to the people'

Appreciating the UNDP's work, he said the report would help the PTI regime "in fine-tuning our policies and the main thing is to protect our poor section of our society and also the regional disparity".

Dr Nishtar was already working on the regional disparity, gathering data that covered almost 75% of Pakistan's population, he said, expressing hope that statistics for the entire population would be compiled by June 2021.

"What we plan to do is give direct subsidies to the people. This untargeted subsidy is utilised by those people who don't need it and the people who need it are actually deprived of it so.

"Once we have this data, then we will be able to directly subsidise that section of the population that's vulnerable whether it's in the rural areas or the urban areas. We can give a different type of subsidy to the small farmers and then to urban consumer who's facing inflation.

"We will then be able to directly help them and the basic food that they consume and we will be able to directly fund them because, unfortunately, commodity prices are rising all over the world because of the COVID-19 disruption of the supply side.

"That's why this data is extremely valuable for us. This really will help us and the UNDP has done a tremendous job — which is beneficial to us — and I’m sure such reports will benefit all the developing world."