| GEO Pakistan|
| Pakistani officials meet IMF amid meltdown fears|
| Updated at: 0518 PST, Wednesday, October 22, 2008|
ISLAMABAD: Finance officials, faced with a looming economic meltdown, brought their case on Tuesday to the International Monetary Fund, though Islamabad has said it would only seek money from the agency as a last resort.
IMF spokesman Niels Buenemann declined to give any specifics from the talks, which were held in Dubai, but officials have said they may have to ask the fund for cash to avoid defaulting on sovereign debt due for repayment next year. Any default would further shatter local and international confidence in the country.
The government has said it would seek the IMF money only as a last resort if it cannot secure some US$5 billion it needs from governments or multilateral agencies like the World Bank. Aid from the agency often comes with conditions such as cutting public spending that can affect programmes for the poor, making it a politically tough choice for the government.
Many analysts believe Pakistan’s front-line role in fighting terrorism will persuade other countries, including the US, to help prevent it from economically imploding. But a global economic crisis, including severe problems in the US, could limit assistance. Pakistan is facing soaring inflation, a plunging currency and chronic power outages. It hopes a recently formed group of countries called Friends of Pakistan — including the US, Britain, Canada, France and Germany — can help financially.
“It is not an extraordinary meeting but, yes, the circumstances have made it so,” said Shaukat Tareen, financial adviser to the prime minister, referring to the fact that regular talks with the IMF were mandatory for signatories.
“We’ll discuss with the IMF about the present economic and financial situation we are facing,” Tareen told media.