What more can the IMF do to help developing economies overcome debt problems?

She said that beyond debt restructuring, the government already has the means to reform areas such as the state-owned enterprises.

Mr Neils Hegewisch, Friedrich-Ebert-Stiftung’s country director in Pakistan, said: “With every new programme, with every new austerity measure, with every new budget, you don’t see any real progress because the overall situation is not improving.”


However, critics have described the IMF’s recommendations of hiking taxes, cutting fuel and business subsidies, as too harsh, echoing long-standing concerns that the agency’s policies often ignore the impact on the poorest.

“This is the prevalent criticism of the IMF in Pakistan, that IMF programmes deteriorate the economy (and) do not take care of the poor. But I don’t think this is a fair criticism in this case, to some extent. Of course, every programme (and) every change that is implemented will not lead to a prosperous future in the short term, so there will be hardships,” said Mr Hegewisch.

At the recent Munich Security Conference, IMF chief Kristalina Georgieva acknowledged Pakistan’s challenges, noting that a third of the population had been affected by devastating floods.

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