KARACHI: The economy of cash strapped country is on a roller coaster in the aftermath of the Covid pandemic and Russia Ukraine war, and now the situation has turned grim as the fifth most populous country is currently facing one of its worst crises in recent memory with foreign exchange reserves have fallen to a critical level of $4.5 billion – lowest in almost a decade.
The looming crisis prompted top civil-military leaders to visit Gulf nations, seeking urgent financial assistance from monarchies to ease the situation.
Amid the gloomy situation, renowned Pakistani-US economist Atif Mian shared startling revelations, opining that the country has already defaulted on payment pledges.
Lately, the financial pundit appeared in a prime-time show on a local news outlet where he claimed that the government should reveal the truth to the masses. ‘Pakistan has already defaulted’, he made the bold statement, showing what it means to default.
Centre for Economic Research Pakistan co-founder said default translates that you fail to live up to the pledges you made with organisations or nations.
Sharing a horror picture, Atif said the country’s economic situation would deteriorate further, calling on the incumbent government to take brave financial decisions. Telling the cure for the problem, he advised authorities to end subsidies for the elite and improve the fundamental financial decision-making process.
For not being able to make payments for crucial things like aiding children’s education or buying essential commodities like chicken meat for a high price, Atif referring the bank’s refusal to transfer the payment that amounts to defaulting on that promise.
He further accused the government of artificially maintaining the dollar value by restricting imports.
Sharing his views on the dilapidating situation, the economic expert termed politicians and other stakeholders responsible for the situation. He was of the opinion that the South Asian nation is stuck in a debt trap situation.
Lately, Pakistani banks are not entertaining customers with import transactions amid dollar shortage, informed sources told Dispatch News Desk.
Rumours were rife that all commercial banks were turning away Letters of Credit after running out of greenback, USD, in a ‘horrible’ economic backdrop.