The IMF Is Using the Debt Crisis to Hollow Out Pakistan’s Sovereignty
Imran Khan's government came to power in 2018 promising to reorient Pakistan's economy toward the needs of the population. But faced with a debt crisis it soon dropped its reformist agenda — and now, the International Monetary Fund is pressuring it to place its State Bank permanently beyond democratic control.
Pakistan’s prime minister Imran Khan speaks during a press conference, 2020. (Wakil Kohsar / AFP via Getty Images)
As the COVID-19 crisis continues to wreak havoc, at the end of March UN Secretary General António Guterres called for “decisive action” to avert the developing world’s deepening debt crisis. He warned that the previous debt obligations of poor countries were fast maturing, threatening to prolong the economic crisis. African governments alone owe $23.4 billion in repayments to financial institutions this year, notwithstanding current pressures — signaling the scale of the economic burden imposed on poor nations across the globe.
The kind of future in store for the developing world can be gauged by the sweeping financial reforms being imposed by the global financial technocracy in Pakistan. A poor country struggling to meet the basic needs of its people, under the pressure of the pandemic its creditors are now being forced into a financial arrangement that will erode any semblance of democratic control over the country’s economy.
IMF Stranglehold
Imran Khan’s Pakistan Tehreek-e-Insaf (PTI) government came to power in August 2018 promising to break the “begging bowl” of the International Monetary Fund and reorient the economy toward meeting the development needs of the public. However, a mounting balance-of-payments crisis inherited from the previous government, as well as economic mismanagement in the first few months under the new administration, forced the country back to the IMF in April 2019.
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