Pakistan now at the mercy of the IMF/WB

The loans that are being offered to Pakistan by the IMF and World Bank (as well as those on offer from individual nations) are going to compound the problems for the country.

First of all, the country is already massively in debt, some 40 to 45 billion dollars by most estimates, with 12 billion of that coming in just the last two years.  Now with the flooding and the enormous costs that the nation’s reconstruction will requires, the prospects for getting out from under that debt seem remote.

Second, the IMF and World Bank have gotten pretty ruthless (even if they are right) in critiquing the Pakistani establishment’s overreliance on foreign loans to keep the country afloat.  The problem is that the solutions that the IMF and World Bank want to impose (the VAT for instance) would target poorer Pakistanis over the elite and let the crooks in Pakistan off the hook.  Already the poor in the country have been hit pretty hard by the flooding; this will only make things worse.  (Incidentally, the rulers of Pakistan have more or less been hand picked by the global elite — so their complaints now ring more than a little hollow).  Tariq Ali gave a good account of the problems with the arguments that the IMF and World Bank are putting forward on Democracy Now.

Add to that, the problems with the flooding are getting worse, not better.  100,000 more people were displaced when Manchur lake in Sindh overflowed.  In some places, the water still hasn’t receded — this is, in part, because the floodwaters are now in the flat, agricultural parts of the country and they have no natural way of moving out.

Luckily, the Pakistani left is organizing and fighting back.  This video is from a rally that happened a few days ago — explicitly connecting the problems of the country with capitalism and international finance institutions.