Pakistan ‘is bankrupt’ and ‘sinking deeper every year’: Atif Mian

[Quwa]

I agree most of the time Pakistanis lived within their means , but I would like to provide some more talking points to Pakistani members.

Below is the pic of REER index of PKR,
< 100 , means undervalued.
> 100 , means overvalued.

As you can see , During the last tenure of Nawaz Sharif PKR was 20% more overvalued.

Here is the last straw which broke the back of the camel.

Losing dollars , taking loans, no growth in export , living beyond the means. This is where it all happened in 4 years.

View attachment 19017

I agree, but it's important to uncover who exactly did the bulk of the importing...

The PML-N's policies supported a sub-group of the wider business class who, in turn, used the cheaper PKR to import goods. They then sold those goods locally, mostly to people who were middle class and above. So, from jobs to businesses to 'cheap' imported goods, it was middle class and up who benefitted from the PML-N. And, in fairness to most middle-class folks, they would've bought locally had it been available to them, but the wider policies basically gutted or disincentivized local production.

The bulk of the benefits of these policies (i.e., "living beyond your means") went to a minority of the population; the top 15-20% at most.

 

[kambhakt]

Not sure where you have been for the past five years but this guy has been touted by all comers as the savior of Pakistan's economic woes and if only IK had appointed him as the economic czar, Pakistan would've been a fully industrialized first world economy by the end of his tenure.

Plus he himself has been on a litany of forums, pontificating on what ails Pakistan's economy and offering impractical high level academic remedies that are bound to fail in Pakistan.

Five years ago, Pakistan economy was in terrible shape. At that time he was involved for some time in an advisory role. That role did not last long. But we also do not know if his advice was followed. It most probably was not followed.

In the meantime almost no steps have been taken to correct the economy. It is now worse than it was 5 years ago. Some of the federal government outflows out of its income are
50 to 55% outflow to provinces as per 18th amendment
65 to 70% outflow for loan services
Salaries to employees and pension to retired employees
Salaries to defence force personnel and pension to retires
Payment of shortfall to IPPs against sovereign guarantees
Reimbursement for losses of PSU like railways, PSM, PIA
Expenses towards various govenrment responsibilites.
Defence expenses
Defence procurements

If you see, the money gets over at point 2. So either increase income or get a loan moratorium. The remedies are the same for every country. If they fail in Pakistan, it is because of the people in charge of Pakistan.

 

[Bear&Bull]

That is not his job. He is just making comments on social media like you and me. But given his background, his comments have a lot more value than ours.

Pakistanis will accept economic advice from anybody excepts econmists!!

 

[Bear&Bull]

Even if what you say is true it does not answer the question why Pakistan is bankrupt.

Pakistan is bankrupt because Pakistanis live above their means

Pakistan is bankrupt primarily due to over-population. Rest are conributing factors.

Don't expect Atif Mian to speak against overpopulation. He is an Ahmadiya and he needs to think about safety of his people living in Pak.

 

[PakFactor]

Five years ago, Pakistan economy was in terrible shape. At that time he was involved for some time in an advisory role. That role did not last long. But we also do not know if his advice was followed. It most probably was not followed.

In the meantime almost no steps have been taken to correct the economy. It is now worse than it was 5 years ago. Some of the federal government outflows out of its income are
50 to 55% outflow to provinces as per 18th amendment
65 to 70% outflow for loan services
Salaries to employees and pension to retired employees
Salaries to defence force personnel and pension to retires
Payment of shortfall to IPPs against sovereign guarantees
Reimbursement for losses of PSU like railways, PSM, PIA
Expenses towards various govenrment responsibilites.
Defence expenses
Defence procurements

If you see, the money gets over at point 2. So either increase income or get a loan moratorium. The remedies are the same for every country. If they fail in Pakistan, it is because of the people in charge of Pakistan.

Nothing was followed because the team of 20 economists broke down after the whole Ahmadiya nonsense started by the religious nut jobs. The others refused to be part of a team that would be blackmailed and where their co-member was outed; remember, those other 19 were professors and market experts trained in the West, and they do not think along religious lines.

PTI managed the economy as well as they could compare to past and present clowns running the show.

 

[kambhakt]

Nothing was followed because the team of 20 economists broke down after the whole Ahmadiya nonsense started by the religious nut jobs. The others refused to be part of a team that would be blackmailed and where their co-member was outed; remember, those other 19 were professors and market experts trained in the West, and they do not think along religious lines.

PTI managed the economy as well as they could compare to past and present clowns running the show.

I totally agree with the 1st paragraph.

Not sure about the second. In IK time, covid did not hit Pakistan badly, so exports could improve at the cost of competition where production was halted. Also there was a moratorium on loan repayment. The moment covid was over and the loan repayment started, Pakistan's economy was in trouble. He was losing popularity when he was removed. If the establishment had waited for a few months, his career as a politician would have been in danger.

 

[nahtanbob]

Nothing was followed because the team of 20 economists broke down after the whole Ahmadiya nonsense started by the religious nut jobs. The others refused to be part of a team that would be blackmailed and where their co-member was outed; remember, those other 19 were professors and market experts trained in the West, and they do not think along religious lines.

PTI managed the economy as well as they could compare to past and present clowns running the show.

Pakistani economy has always done well when they get debt relief. They got in 2002 due to 9/11 and in 2020 due to covid

 

[SaadH]

Five years ago, Pakistan economy was in terrible shape. At that time he was involved for some time in an advisory role. That role did not last long. But we also do not know if his advice was followed. It most probably was not followed.

In the meantime almost no steps have been taken to correct the economy. It is now worse than it was 5 years ago. Some of the federal government outflows out of its income are
50 to 55% outflow to provinces as per 18th amendment
65 to 70% outflow for loan services
Salaries to employees and pension to retired employees
Salaries to defence force personnel and pension to retires
Payment of shortfall to IPPs against sovereign guarantees
Reimbursement for losses of PSU like railways, PSM, PIA
Expenses towards various govenrment responsibilites.
Defence expenses
Defence procurements

If you see, the money gets over at point 2. So either increase income or get a loan moratorium. The remedies are the same for every country. If they fail in Pakistan, it is because of the people in charge of Pakistan.

No, he was not involved in an advisory role, his name came up as a potential advisor but was quickly pulled back for obvious reasons. Plus he didn't offer any meaningful and practical advice...

 

[kambhakt]

No, he was not involved in an advisory role, his name came up as a potential advisor but was quickly pulled back for obvious reasons. Plus he didn't offer any meaningful and practical advice...

Obvious reason = he was ahmedi

He was kicked out before he could offer any advice.

 

[Bear&Bull]

Pakistani economy has always done well when they get debt relief. They got in 2002 due to 9/11 and in 2020 due to covid

2020 was repayment moratorium. No debts were written off, the duration of payment was increased with more interest payments.

 

[nahtanbob]

2020 was repayment moratorium. No debts were written off, the duration of payment was increased with more interest payments.

So was 2002. The interest was deferred or reduced

 

[Bear&Bull]

So was 2002. The interest was deferred or reduced

It basically means that future governments will have to pay even higher interest on debt, leave alone have money for principal repayment.

 

[Developereo]

He was kicked out before he could offer any advice.

What's stopping him from offering meaningful advice now?

He is just ranting and his 'meaningful insights' are no more insightful that the comments in this thread. Economy is like a Rorschach test: everybody has their opinion on the causes and solutions.

 

[kambhakt]

What's stopping him from offering meaningful advice now?

He is just ranting and his 'meaningful insights' are no more insightful that the comments in this thread. Economy is like a Rorschach test: everybody has their opinion on the causes and solutions.

Why give free advice to the people who kicked you out.

 

[Orpheus]

I agree, but it's important to uncover who exactly did the bulk of the importing...

The PML-N's policies supported a sub-group of the wider business class who, in turn, used the cheaper PKR to import goods. They then sold those goods locally, mostly to people who were middle class and above. So, from jobs to businesses to 'cheap' imported goods, it was middle class and up who benefitted from the PML-N. And, in fairness to most middle-class folks, they would've bought locally had it been available to them, but the wider policies basically gutted or disincentivized local production.

The bulk of the benefits of these policies (i.e., "living beyond your means") went to a minority of the population; the top 15-20% at most.

And that’s where the voter base is from for pmln-ppp lower middle class-pti middle to upper middle class