IMF chief Georgieva tells cash-strapped Pakistan to ‘tax the rich, protect the poor’

New York/Islamabad, Sep 21 (PTI) IMF Managing Director Kristalina Georgieva has urged Pakistan to collect more taxes from the wealthy and protect the poor people, as the cash-strapped country reels under double-digit inflation after securing a bailout from the global lender in July, media reports said on Thursday.

Speaking to Geo News after meeting Interim Prime Minister Anwaarul Haq Kakar on the sidelines of the 78th United Nations General Assembly (UNGA) session in New York, Georgieva said that it is in the interest of the people of Pakistan that the country revitalises its economy and addresses some of the “shortcomings” of the past.

“What we are asking in our programme is that please collect more taxes from the wealthy and please protect the poor people of Pakistan,” the IMF chief said.

“I do believe this is in line with what people in Pakistan would like to see for the country,” she added.

“Shortcomings” of the past should be addressed, Georgieva urged, referring to reforms the International Monetary Fund (IMF) has sought in the country, Geo News reported from New York.

Her comments come amid soaring inflation in Pakistan after the Washington-based global lender transferred USD 1.2 billion to the cash-strapped country in July, a part of the USD 3 billion bailout programme for nine months to support the government’s efforts to stabilise the country’s ailing economy.

The steps taken by the government to get the IMF’s approval made lives difficult for the masses, as a massive hike in electricity and petrol prices pushed inflation to a record level, the report said.

Pakistan’s inflation leapt to 27.4 per cent in the month of August.

The IMF Managing Director took to social media platform X and said, “Very good meeting with Pakistan’s PM @anwaar_kakar today on Pakistan’s economic prospects. We agreed on the vital need for strong policies to ensure stability, foster sustainable and inclusive growth, prioritise revenue collection, and protection for the most vulnerable in Pakistan.”

Caretaker Prime Minister Kakar also posted on X, terming his meeting with Georgieva a “constructive dialogue” and said it “emphasised extending our mutual commitment towards bolstering economic stability and growth in Pakistan.”

According to The Express Tribune newspaper, an official handout released by the Prime Minister’s Office said Kakar expressed gratitude for the global lender’s approval of the USD 3 billion standby agreement to support Pakistan’s economy.

The handout said the premier briefed Georgieva on the various measures taken by the government to “stabilise and revive the country’s economy”.

“The prime minister affirmed that these initiatives aim to create a stable and conducive environment for sustainable economic growth and investment. Additionally, a strong focus had been placed on protecting the vulnerable segments of society,” the PMO statement said.

It further said that Georgieva “appreciated Pakistan’s concerted efforts in implementing policies and reforms to revive the economy” and assured that the IMF remained committed to continued engagement with Pakistan.

The development comes a day after a report by the Asian Development Bank (ADB) warned that the downside risks to Pakistan’s economic outlook remain exceptionally high and said that the cash-strapped country’s adherence to an economic adjustment programme through April 2024 would be critical for restoring stability and the gradual recovery of growth.

Pakistan’s economy has been in a free fall mode for the last many years, bringing untold pressure on the poor masses in the form of unchecked inflation.