Pakistani Economic Stress Watch

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dhyana
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Re: Pakistani Economic Stress Watch

Postby dhyana » 06 Jul 2018 10:49

Pakistan seeks more loans from China to avert currency crisis

Officials in Islamabad have warned their Chinese counterparts that if the lending dries up, it could threaten the future of the China-Pakistan Economic Corridor, the cornerstone of President Xi Jinping’s Belt and Road Initiative.

They say that if Pakistan is forced to approach the IMF instead, it may have to disclose details of how the scheme is being funded, and even cancel some of the infrastructure projects already planned.


Pakis doing what they do best.. alternating between Blackmail and GUBO. Truly they have no shame. And it couldn't happen to a better set of Iron Brothers.

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Re: Pakistani Economic Stress Watch

Postby Vips » 06 Jul 2018 19:49

They think they are too smart. The Chinese will literally take them through the cleaners - which only means more strategic challenges for India. The Paki whore will cite this to declare victory and justify being slaves to the Chinese.

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Re: Pakistani Economic Stress Watch

Postby Amoghvarsha » 08 Jul 2018 02:00

dhyana wrote:Pakistan seeks more loans from China to avert currency crisis

Officials in Islamabad have warned their Chinese counterparts that if the lending dries up, it could threaten the future of the China-Pakistan Economic Corridor, the cornerstone of President Xi Jinping’s Belt and Road Initiative.

They say that if Pakistan is forced to approach the IMF instead, it may have to disclose details of how the scheme is being funded, and even cancel some of the infrastructure projects already planned.


Pakis doing what they do best.. alternating between Blackmail and GUBO. Truly they have no shame. And it couldn't happen to a better set of Iron Brothers.


This is so funny. Will the chinese just get played like this?

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Re: Pakistani Economic Stress Watch

Postby JohnTitor » 08 Jul 2018 05:52

^^ The Chinese are not stupid. Like a python, they will slowly and patiently get a vice like grip. Then they will extract their pound of flesh. Just look at their projects in Sri Lanka, Africa and South America

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Pakistani Economic Stress Watch

Postby Peregrine » 11 Jul 2018 21:45

X Posted on the Terroristan Thread

Back to the IMF

THERE is growing awareness that Pakistan is firmly on the road back to the IMF for an emergency loan as the country’s foreign exchange reserves head towards the critical mark of one month’s import cover. It is an open question when that point will be reached, considering that the recent rounds of exchange-rate depreciation have given a boost to exports. But that boost may not last long, and the depreciations have also driven inflation since they are responsible for the rise in the price of fuel imports, both petroleum and natural gas. The debate on timing aside, the fact that Pakistan is set to repeat the cycle of depleting foreign exchange reserves, followed by an approach to the IMF, shows that despite growth in the real sector, the fundamental dysfunctions of the economy remain entrenched in the five years since 2013 when the Fund’s support was last availed.

Now that the awareness of an impending return to the IMF is spreading, some anxieties are being stoked along the way. A recent report in the Financial Times, citing unnamed officials, pointed out that being in a Fund programme would mean opening up the financial details of all CPEC loans and grants, as well as the financing terms on which other Chinese loans have been taken for balance-of-payments support. The report cited unnamed officials as saying that such an eventuality has been the topic of discussion between Pakistani and Chinese officials — and if true, it sounds a bit like blackmail. One can only hope it has not come to this, but if it has, then the government is treading on a dangerously narrow ledge.

It may well come to that though, given that Pakistan is fast running out of options to shore up its reserves. Already at least $2bn have been drawn from the Chinese as balance-of-payments support, and the currency swaps position also shows some drawings. With options running out, and the deficit on the current account persisting, a future course of action is becoming urgent. The interim government has done the right thing in refusing to engage in what amounts to a strategic policy choice that goes far beyond the mandate of a caretaker set-up. What is needed is work to begin on what a potential letter of intent might look like and what sort of commitments Pakistan is ready to make in return for a Fund bailout so that at least the outline of an action plan can be left behind for the new government which would then not have to start from scratch. It is always better to go to the IMF with an action plan. The caretakers could encourage that conversation among government, business and economists. That would be within their mandate.

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Re: Pakistani Economic Stress Watch

Postby Suraj » 11 Jul 2018 22:44

Posting in the aviation thread led me to look up TSP commercial aviation data. Annual passenger movement 2016-17 fiscal year:
Karachi: 6.8M
Islamabad: 5.0M
Lahore: 4.8M

That's all ?? They have no airports in the top 100 in Asia. Karachi's numbers won't even get into the top 10 in India. The combined passenger traffic of all airports in Pakistan, at ~21M, is less than a third of DEL's 66M .

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Re: Pakistani Economic Stress Watch

Postby Neshant » 12 Jul 2018 12:59

The infrastructure China built in Pakistan (with chinese companies, chinese labor and chinese material) is not worth more than 1/5th to 1/7th the actual amount China spent on it.

Essentially China is handing Pakistan an inflated bill for what amounts to dumping its surplus production & construction material on Pakistan.

So called OBOR infrastructure is primarily to benefit China's strategic goals - with Pakistan footing the bill.

Amazingly Pakistan is stupid enough to accept the bill from China at face value and sign on the dotted line.

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Re: Pakistani Economic Stress Watch

Postby RKumar » 12 Jul 2018 13:11

Peregrine wrote:X Posted on the Terroristan Thread

Back to the IMF


Keep in mind, IMF might not help them this time ... there is no Ombaba around who will push the private notes for them.
Second, they haven't fulfilled their last promises
Third, they are on the preferred - terrorist funding list

So good luck to them without USA support!!

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Pakistani Economic Stress Watch

Postby Peregrine » 12 Jul 2018 14:29

Neshant wrote:The infrastructure China built in Pakistan (with chinese companies, chinese labor and chinese material) is not worth more than 1/5th to 1/7th the actual amount China spent on it.

Essentially China is handing Pakistan an inflated bill for what amounts to dumping its surplus production & construction material on Pakistan.

So called OBOR infrastructure is primarily to benefit China's strategic goals - with Pakistan footing the bill.

Amazingly Pakistan is stupid enough to accept the bill from China at face value and sign on the dotted line.
Neshant Ji

Solly Sil. Chinawala play "Old Lussian Tlick"!

Just as Russia sold Old Mothballed Steel Plant to India in Bhilai Originally rated at 1.1 Million, now producing Five Million Tonnes and further expanding to 7.5 Million Tonnes and Terroristan in Port Qasim - near Karachi - which has been shut down for about three years, Chinawala has sold OLD UNECONOMIC MOTHBALLED Electric Generating Power Plants to Terroristan. So basically these Plants are FREE to Chinawala but Terroristan has to Pay the Full Brand New Plant Price.

Pakistan Steel Lasted for about 30 Years and produced a maximum of about 800 Thousand Tonnes in its Best Performance Year. Let us see how long the presently Electric Plants being given to Terroritan operate at their Maximum Rated Capacity!

It is the same story for ALL MAJOR EQUIPMENT being "SOLD" by Chinawala to Terroristan for the complete CPEC-OBOR Programme.

LONG LIVE CHINESE TERRORISTANI FRIENDSHIP!

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Re: Pakistani Economic Stress Watch

Postby chetak » 12 Jul 2018 14:54

JohnTitor wrote:^^ The Chinese are not stupid. Like a python, they will slowly and patiently get a vice like grip. Then they will extract their pound of flesh. Just look at their projects in Sri Lanka, Africa and South America


the pakis are playing them, but also, the hans just cannot afford to let the paki house of cards collapse now.

If pushed to the wall, the only thing that the pakis have to sell at this stage, apart from their sharia imprinted backsides, is their nukes. iran is ready and waiting but they are on the wrong side of the sharia divide.

iran may have short and mid range delivery systems on hand so they just have to screw on the paki warheads to become NOKO's soul brother from another mother.

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Re: Pakistani Economic Stress Watch

Postby yensoy » 12 Jul 2018 20:37

chetak wrote:
JohnTitor wrote:^^ The Chinese are not stupid. Like a python, they will slowly and patiently get a vice like grip. Then they will extract their pound of flesh. Just look at their projects in Sri Lanka, Africa and South America


the pakis are playing them, but also, the hans just cannot afford to let the paki house of cards collapse now.

If pushed to the wall, the only thing that the pakis have to sell at this stage, apart from their sharia imprinted backsides, is their nukes. iran is ready and waiting but they are on the wrong side of the sharia divide.


Yes, the Pakis now are in a unique position to call OBOR's bluff, which will reflect very poorly on Eleven, maybe even taking him out. Nobody knows the power of blackmail like the Pakis. They will keep threatening the Chinese to go to IMF and let out all secrets pertaining to CPEC (this play is already underway https://therealnews.com/pakistans-financial-crisis-puts-belt-and-road-on-the-spot, a reprint of FT article behind paywall).

I don't think it will go as far as nuke selling.

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Re: Pakistani Economic Stress Watch

Postby rsingh » 12 Jul 2018 21:02

This thing is always in my mind; what are option for Chinese.........basically none.

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Re: Pakistani Economic Stress Watch

Postby Aditya_V » 12 Jul 2018 21:27

If Pakis play the Chinese every Obar country is going to play them. At some time China will have to show it can enforce its debt collection.

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Re: Pakistani Economic Stress Watch

Postby rsingh » 12 Jul 2018 21:45

^^^^
How ?

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Re: Pakistani Economic Stress Watch

Postby Karthik S » 12 Jul 2018 22:03

yensoy wrote:
chetak wrote:
the pakis are playing them, but also, the hans just cannot afford to let the paki house of cards collapse now.

If pushed to the wall, the only thing that the pakis have to sell at this stage, apart from their sharia imprinted backsides, is their nukes. iran is ready and waiting but they are on the wrong side of the sharia divide.


Yes, the Pakis now are in a unique position to call OBOR's bluff, which will reflect very poorly on Eleven, maybe even taking him out. Nobody knows the power of blackmail like the Pakis. They will keep threatening the Chinese to go to IMF and let out all secrets pertaining to CPEC (this play is already underway https://therealnews.com/pakistans-financial-crisis-puts-belt-and-road-on-the-spot, a reprint of FT article behind paywall).

I don't think it will go as far as nuke selling.


I don't think pakis can threaten Chinese. They can do that only to us.

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Re: Pakistani Economic Stress Watch

Postby nam » 12 Jul 2018 22:07

Time to carry out some ABM test and band it Pak nukes are now useless.

Time for Pak to build more nukes and buy more weapons. It cannot compromise on it's superiority being eroded can it?

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Re: Pakistani Economic Stress Watch

Postby Katare » 12 Jul 2018 23:05

Aditya_V wrote:If Pakis play the Chinese every Obar country is going to play them. At some time China will have to show it can enforce its debt collection.


Debts always get paid unless the borrowing country files for bankruptcy. Pakis will have to hand over the assets like Sri Lankans did to pay for the debts. Chinese investments are politically and strategically driven efforts where end goal is to buy influence and assets that provide a foot hold.

Unlike massa, who would waive loans China would only take a haircut in return for equities.

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Re: Pakistani Economic Stress Watch

Postby chetak » 13 Jul 2018 08:58

Karthik S wrote:
yensoy wrote:
Yes, the Pakis now are in a unique position to call OBOR's bluff, which will reflect very poorly on Eleven, maybe even taking him out. <snip>

I don't think it will go as far as nuke selling.


I don't think pakis can threaten Chinese. They can do that only to us.


Not "threaten" but become "creatively selective" in their cooperation.

The paki army has already shot it's bolt when it failed to provide the promised and paid for CPEC security to the hans in balochistan. The chinese know their true worth now hence the direct and belittling negotiations with the baloch.

Can anything be more demeaning??.

the spectacle of the slyly insidious occupier, who has now emerged from the shadows, slowly and surely tightening the coils around an already strangulating pakiland, completely bypassing the "elected govt" of a "democratic" state and negotiating directly with paki insurgents on paki soil, their much vaunted "sarzameen"??

Surely the neutered paki army's cup of mardanagi (मर्दानगी) runneth over?? Can any army be any more hijda??

The average paki abdul is slowly beginning to realize that CPEC will not help him much but will monetarily benefit an already fatted paki army which has a stranglehold on their national resources.

Shortly, after the elections, the PA will also entrench itself even more solidly into the role of the power behind the throne than ever before, maybe even going so far as amending their already leaky constitution. It is presently manipulating the elections ao as to get its preferred candidate into the PM's chair.

This will surely have the approval, if not the actual instigation of the hans who after the security debacle in balochistan will be demanding iron clad guarantees to safeguard their CPEC investments, given what has happened in malayasia??.

There was absolutely no need to go after ganja in such a demeaning manner since he was already a well known paki army's tightly leashed paltu kutta or pet dog. The PA is acting on instructions of the chinese to get a lock on the new paki govt via the army (single point contact) so that they can control the narrative henceforth

And, that is also the reason why the chinese have been so generous and quick in funding the failing paki state with the transfusion of billions of dollars in loans, especially when great paki beneficiaries like saudi and other gulf states have held on to their purse strings and determinedly stayed away, maybe, just maybe, because of the pointed suggestions of the US.


The chinese are doing in pakiland what they could not achieve in malaysia and SL. To work according to plan, heavy "investments" need the continuous blessings from the host country governments, and also being immune to any hostile amendments in the agreements brought about by these changed govts.

The chinese could not prevent the black swan events of the damaging change of governments in SL as well as malaysia.

This may even become a template of sorts for other countries to get out of the clutches of the hans, should they decide to.

They will now ensure the protection of the very heart of their CPEC strategy, the total and undisputed control of gwadar.
Last edited by chetak on 13 Jul 2018 09:27, edited 1 time in total.

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Re: Pakistani Economic Stress Watch

Postby Kashi » 13 Jul 2018 09:26

Chetak, why do believe TSPA going after badmaash was engineered by the Han? What benefit do they gain from having Im the dim at the helm that they could not have gotten from badmaash? As you pointed out, badmaash was as pliable as they can get.

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Re: Pakistani Economic Stress Watch

Postby chetak » 13 Jul 2018 09:43

Kashi wrote:Chetak, why do believe TSPA going after badmaash was engineered by the Han? What benefit do they gain from having Im the dim at the helm that they could not have gotten from badmaash? As you pointed out, badmaash was as pliable as they can get.


IK is a mere puppet and will never be in control, the PA will be. IK is also as anti India as they come, despite his adulation by the creaming TV anchors in the Indian media. He may well have poked one or two or three of them already.

There have already been many hints in the paki press about what IK has been up to with his shalwar off.

Surely there is never smoke without some little fire, no?? perhaps some graphic photographic as well as multimedia smoke with IK in the lead role, a little skit with script, direction and photography by the ISI and lead role by IK with immaculate color by Image

The PA is under the firm control of the hans because of their weapon sales and direct aid.

If the hans stop weapon sales or slow down the spares support of the already existing hardware, the pakis will have no other source. The PAF and the PN will grind to a halt.

EU and US will not help nor will russia, beyond a point, so they will be left at the mercy of a rapidly modernizing Indian Army (the paki view!!), and an India under Modi, that is very aggressively weaponizing far more than just its diplomacy.
Last edited by chetak on 13 Jul 2018 09:57, edited 1 time in total.

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Re: Pakistani Economic Stress Watch

Postby Kashi » 13 Jul 2018 09:50

Exactly my point. As we know that TSPA would be in control regardless of who's at the helm. But you specifically stated that TSPA was acting on Chinese instructions when it went after badmaash. I was asking for the reason why you think so. Why would Chinese who are already dealing with TSPA on CPEC and other matters instruct them to get rid of badmaash? How does it help them in any way?

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Re: Pakistani Economic Stress Watch

Postby chetak » 13 Jul 2018 10:17

Kashi wrote:Exactly my point. As we know that TSPA would be in control regardless of who's at the helm. But you specifically stated that TSPA was acting on Chinese instructions when it went after badmaash. I was asking for the reason why you think so. Why would Chinese who are already dealing with TSPA on CPEC and other matters instruct them to get rid of badmaash? How does it help them in any way?


Just like the UK says that it is a "crowned" democracy because of their queen, the paki will become a "dictatorship" democracy if the PA hand is too obviously seen.

Why do you think that the PA has not openly taken over the country when they could have easily done so for so many years now.

Why do they now persist on playing from behind the scenes??

For a "dictatorship" regime, many avenues are very firmly closed off. International banks, rating houses, FDI, foreign JVs ittyadi are closed off or very severely curtailed and their influence, as well as status in the commity of nations, degrades rapidly leading to unpleasant consequences in a myriad of ways. International sanctions will most probably follow such a move and they would be ignored in the UN, removing the one soapbox that the pakis use often.

Would India be as free with its visas if the paki army took over that benighted country?? Would other countries??

Don't quote the example of the musharraf regime because the US was firmly on the side of the pakis then and supported them openly. The hans will shut off the tap very much before they reach anywhere nearing the tolerance levels of the US.

Even today, the PA would need express approval of the US to overthrow the civilian govt and take over.

This way they have engineered a coup as well as conducted "democratic" free and fair elections. They have, in one stroke, sabotaged the futures of badmash as well as zardari and also ensured that the tamed judiciary will ride roughshod when called upon to do so.

I strongly feel this is the chinese solution. They have the paki legislature, the paki army and the paki judiciary in their corner.

For any unforeseen exigencies, the elegant tried and tested benazir sunroof lever solution is always there, to be used as required.
Last edited by chetak on 13 Jul 2018 11:04, edited 1 time in total.

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Re: Pakistani Economic Stress Watch

Postby Lisa » 13 Jul 2018 11:00

Default is a great deal more common than most people think. Nobody files for bankruptcy and nobody seizes assets in lieu of sovereign debt in the common understanding of seizure. Debt ends up being restructured and if not so, lenders stop lending. That's all.

The Chinese are and will remain toothless as they are not yet members of the Club that can enforce market exclusion to a default nation. Only the West can and does.

You may wish to read the following,

https://en.wikipedia.org/wiki/List_of_s ... ebt_crises

https://en.wikipedia.org/wiki/Sovereign_default

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Re: Pakistani Economic Stress Watch

Postby yensoy » 13 Jul 2018 11:07

chetak wrote:Why do you think that the PA has not openly taken over the country when they could have easily done so for so many years now.
Why do they now persist on playing from behind the scenes??


Shri Kerry and Shri Lugar. As you point out, a lot of taps will close, and Pak will be somewhere between Iran and NoKo. So there will be figurehead civilian leader for some time.

Sharif grew too big for his boots. He is an old Zia acolyte, he surely knows where the bodies are hidden; unfortunate with the Panama Papers and Calilbri situation, the army has more mud on him than he has on them (besides who in Pakistan - besides maybe 4 individuals - is willing to call out the Army's misdeeds?).

Karthik S wrote:I don't think pakis can threaten Chinese. They can do that only to us.


Never estimate the depths to which Pakis can sink. "What can you do for us" is a common refrain, now with 220 million heads and counting. Taqiyya is another tool to feign falling in line (in return for money and arms, of course). Don't also underestimate Chinese and Western interests to right-size India by feeding the mangy dog to our left.

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Re: Pakistani Economic Stress Watch

Postby chetak » 13 Jul 2018 11:21

yensoy wrote:
chetak wrote:Why do you think that the PA has not openly taken over the country when they could have easily done so for so many years now.
Why do they now persist on playing from behind the scenes??


Shri Kerry and Shri Lugar. As you point out, a lot of taps will close, and Pak will be somewhere between Iran and NoKo. So there will be figurehead civilian leader for some time.

Sharif grew too big for his boots. He is an old Zia acolyte, he surely knows where the bodies are hidden; unfortunate with the Panama Papers and Calilbri situation, the army has more mud on him than he has on them (besides who in Pakistan - besides maybe 4 individuals - is willing to call out the Army's misdeeds?).

Karthik S wrote:I don't think pakis can threaten Chinese. They can do that only to us.


Never estimate the depths to which Pakis can sink. "What can you do for us" is a common refrain, now with 220 million heads and counting. Taqiyya is another tool to feign falling in line (in return for money and arms, of course). Don't also underestimate Chinese and Western interests to right-size India by feeding the mangy dog to our left.


This may well be the actual bajwa doctrine, after all.

Also, the chinese, as well as the west, only need India's markets and resources, without a dominant and aggressive India, mucking up the whole plot by bringing in Indian "interests" into the mix.

Just like the subservient and comatose colonial India of the past.

With the next (IK??) govt in chair, there will be a concerted all out paki effort to coerce India on to the negotiating table, backed by china who will try her damndest to forcibly insert herself into the India paki dialogue process and non state actors will dominate their "diplomatic" efforts.

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Re: Pakistani Economic Stress Watch

Postby Manish_P » 13 Jul 2018 11:51

Indus dam work creates national fervour in Pakistan

The Pakistani Army and other establishments are rallying behind a controversial dam project on the Indus River in disputed territory that has taken on new wind after India frustrated attempts by Islamabad to get international funding for years.


Pakistan Chief Justice Saqib Nisar who ordered the setting up of a public fund for the project, linked raising money for the dam to the 1965 war with India, personally initiating it with a (Pakistani) Rs 1 million donation.


Pakistani Army Chief Gen Qamar Javed Bajwahas pledged a month’s salary to the fund that has reached Rs 50 million within days. Besides the Army and Supreme Court employees, several prominent personalities like former cricketer Shahid Afridi as well as private institutions have pledged funds for the dam. Officers of the Pakistani armed forces are donating two days’ pay while soldiers have been mandated to donate one day’s pay for the project that is being touted as the solution to its water scarcity problems.Several government controlled institutions have made similar pledges, while appeals are also being made to overseas Pakistanis to donate money for the dam


The fund is still away from the estimated Rs 1.6 trillion needed for the dam
:rotfl:

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Re: Pakistani Economic Stress Watch

Postby pankajs » 13 Jul 2018 12:46

If the bakis stop eating for a year they should be able to fund the dam project.

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Re: Pakistani Economic Stress Watch

Postby chetak » 13 Jul 2018 12:56

pankajs wrote:If the bakis stop eating for a year they should be able to fund the dam project.


including the grass which psycho bhutto mandated as the sharia approved diet in adverse times.

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Re: Pakistani Economic Stress Watch

Postby ArjunPandit » 13 Jul 2018 23:06

^^they need to fulfil bhutto's words completely, they have the bomb now time to eat grass

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Re: Pakistani Economic Stress Watch

Postby dhyana » 16 Jul 2018 15:07

Rupee plunges to 128 against US dollar in intra-day trading

The Pakistani currency weakened over 5% to hit an intra-day low of Rs128 against the US dollar in the inter-bank market on Monday... On Friday, the currency closed at Rs121.55 in the inter-bank market.

Currency dealers in the open market have voluntarily halted transacting in dollars, awaiting clarity on rates and the extent to which the rupee would fall. Calls made to the central bank spokesman on the development were left unanswered.


All the best! But honestly, it needs to depreciate a little more to get to the desired 2:1 Rupee ratio.

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Re: Pakistani Economic Stress Watch

Postby yensoy » 16 Jul 2018 17:50

Looks like it's true PKR has decided to "do more" falling https://www.urdupoint.com/en/business/today-currency-rate-in-pakistan-rates-on-16-393379.html.

What is really surprising is how poorly PKR/USD is tracked, and how opaque its trading is. For instance, if INR drops by 1 rupee to the USD you will see news headlines in all Indian news sites including in non-business journals; however with PKR/USD it's not even a ticker or top line in the business section of papers (like the Dawn) when it falls by 5%! I think Paki economy, assuming they have one, is rather decoupled from the rest of the world.

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Re: Pakistani Economic Stress Watch

Postby Katare » 16 Jul 2018 19:38

Lisa wrote:Default is a great deal more common than most people think. Nobody files for bankruptcy and nobody seizes assets in lieu of sovereign debt in the common understanding of seizure. Debt ends up being restructured and if not so, lenders stop lending. That's all.

The Chinese are and will remain toothless as they are not yet members of the Club that can enforce market exclusion to a default nation. Only the West can and does.

You may wish to read the following,

https://en.wikipedia.org/wiki/List_of_s ... ebt_crises

https://en.wikipedia.org/wiki/Sovereign_default


A lot of what you say is true but there is a great deal of contradiction in your post itself. Filing bankruptcy means debts get unpaid and the process of bankruptcy is for people who can not pay their debts back. In international sense a bankruptcy means that you loose ability to raise new funds (junk status etc) and pretty much everyone pulls out their money or future flow. This causes immense asset losses, hardship and violence which every country wants to avoid at all cost. Debtors would also chip in with hair cuts because those bonds/loans were given at much higher rates anyhow to cover the risk.

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Re: Pakistani Economic Stress Watch

Postby menon s » 17 Jul 2018 13:41

Pakistan has gone to IMF, and asked for 21 bn dollars, but was offered only, 5 billion as help, and that too after the new regime is in place. at present they have 7bn dollars at hand. and their Imports have grown to 62 bn usd per year, which means about 5 bn a month. Without 2 months reserves, my opinion is that you cannot open LCs....Could someone clarify in this regard?

rsingh
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Re: Pakistani Economic Stress Watch

Postby rsingh » 17 Jul 2018 19:53

^^^^
What is this love affair between Bakistan and IMF? It offered 5 billion knowing very well that money is going to black hole?

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Re: Pakistani Economic Stress Watch

Postby Katare » 17 Jul 2018 20:51

They give money only when the country agrees to their conditions which ensures that situation would improve enough to keep it afloat and pay back IMF. IMF conditions are almost always extremely hard to implement for political reasons but they are good for the economy. IMF loans are very short term loans too.....

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Re: Pakistani Economic Stress Watch

Postby rsingh » 17 Jul 2018 21:02

^^^
Mana.....but have they paid anything back?

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Re: Pakistani Economic Stress Watch

Postby yensoy » 17 Jul 2018 21:16

^^^^ I don't think Pakis have defaulted, yet. So they keep borrowing more to pay their debtors which keeps their game going and is sort of good for us. The closest they came to defaulting was when they shafted their equivalent of NRI deposits (Paki expats holding forex in Pakistan were given worthless rupees in return at official rates), at least that is my recollection.

Moving forward, I doubt they will stiff the IMF or the Chinese. They will probably sell their first borns to the Chinese and pay off the IMF with these funds.

For our interests to fructify it will be a milestone if they are unable to fund their army due to funds crunch, or restrictions placed by IMF; an even better outcome would be them renouncing nukes for money. I don't see these happening in the next 10 years. We will have to wait it out while their population grows and arable land shrinks, at the same time hoping that Foggy Bottom doesn't return to its normal fscked up way of doing business.

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Re: Pakistani Economic Stress Watch

Postby Aditya_V » 17 Jul 2018 21:48

Can't Pakis invite Hurrirat over , gold them ransom and ask their families to pay a few crore. They can also state that Kashmir is need to pay them money

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Re: Pakistani Economic Stress Watch

Postby anupmisra » 20 Jul 2018 16:53

IN PAKISTAN’S CURRENCY CRISIS, CHINA IS THE PROBLEM AND THE SOLUTION

Having racked up unsustainable bills in supporting Beijing’s infrastructure master plan, Islamabad is bailed out by China to the tune of US$1 billion – leaving it more dependent than ever on its ‘all-weather ally’
A last-ditch Chinese loan may have temporarily rescued Pakistan from a foreign exchange reserves crisis, but experts say Islamabad’s growing dependence on Beijing has become as much a liability as it is an asset.
Pakistan’s imports of machinery have spiked as it takes on US$19 billion of power and infrastructure projects for the China-Pakistan Economic Corridor (CPEC) project that will link the Chinese province of Xinjiang to the Arabian Sea through Pakistan.
In the first two years of the CPEC project, up to June 2017, Pakistan’s imports of machinery and transport equipment jumped 51 per cent to US$15.5 billion.
“Pakistan’s dependence on China has increased startlingly,” said A.A.H. Soomro, senior adviser for Tundra Fonder, a Stockholm-based emerging markets fund manager.
In addition to US$6 billion in financing for CPEC projects granted over the last two and a half years, China loaned Pakistan’s Finance Ministry more than US$5 billion during the financial year 2017-18. That is equivalent to half of Pakistan’s total foreign funding.
Pakistan, he said, had no choice but to turn to China because having refused to join the Saudi Arabia-led coalition waging a war in Yemen, it could no longer rely on Middle Eastern allies
“We have no choice but to look to China, even outside CPEC, when we are in trouble. This also suits China because, by offering us non-CPEC external financing, it can be seen in Pakistan as a real, though gradual, replacement for the US,”
Pakistan’s current account deficit has risen to nearly US$16 billion for the first 11 months of financial year 2017-18, from just US$4.86 billion for all of 2015-16. To bridge the deficit, the country has depleted its gross forex reserves to US$16.2 billion at the end of June, from a peak of US$23.5 billion in October 2016.
Soomro said China had secured advantageous terms for CPEC, but these were not to blame for Pakistan’s forex woes. “The investment was necessary, even if these lucrative returns were unwarranted and anti-competitive,” he said.
To boost exports, the central bank has devalued the rupee to the US dollar by about 15 per cent, making Pakistan’s currency the worst performer in Asia this year.
Without China’s billion-dollar loan, Pakistan’s forex reserves would have dipped beneath the two-month minimum needed for further loans from the World Bank.
But further Chinese loans may not be so easily forthcoming unless Pakistan commits to structural economic reforms similar to those called for by the International Monetary Fund (IMF)
It would fall on Pakistan’s next government, due to take office after a general election on July 25, to decide whether to seek an emergency balance of payments bailout from the IMF. This would entail the disclosure of at least the headline terms of CPEC financing – something which China does not want to be made public.


Hobson's choice.

https://www.scmp.com/week-asia/geopolit ... d-solution

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Re: Pakistani Economic Stress Watch

Postby dhyana » 23 Jul 2018 01:25

China’s Global Building Spree Runs Into Trouble in Pakistan

An excellent article detailing some of the CPEC projects and their costs (political and economic). Of course, BRF once again is ahead of the curve in its predictions. I believe the full article is behind WSJ's paywall. Here are some gems:

The U.S. helped build Pakistan’s infrastructure in the 1950s and 60s, when it saw the country as a Cold War ally. More recently, Washington focused on other economic aid and security assistance to fight groups such as the Taliban.

With the U.S. freezing all security aid and winding down economic support this year, Pakistani officials now say its financial future lies in emulating China’s emergence as a low-cost manufacturing hub. CPEC, they say, will ease energy and transport bottlenecks, paving the way for Chinese-style “special economic zones” to lure foreign investors.

Pakiland a world-class manufacturing hub? I need to get some of the stuff they are smoking.

Official figures reviewed by the Journal show that Chinese-backed power plants were promised annual returns on investment of up to 34%, guaranteed by Pakistan’s government, in dollars, for 30 years.
:shock:

Nadeem Javaid, chief economist of Pakistan’s planning ministry, suggests China should rescue Pakistan with an interest-free loan. “It would be a kind of favor,” he says. If not, “for what do we have this friendship?”

Another senior Pakistani official says an IMF bailout would need to be $8 billion to $10 billion. The outgoing government, he says, “made lots of attempts” to negotiate a Chinese bailout instead, but the Chinese disengaged in recent weeks because they wanted to deal with the new government after the election.
...
The rationale has been partly to generate better returns for Chinese banks than they can obtain at home, and to drum up overseas business to use China’s surplus industrial capacity.
...
A Chinese bailout could feed worries that Beijing is using Belt and Road to extract onerous concessions, including equity in strategically important assets.

Well, duh


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