WASHINGTON – After squeezing Pakistan in the FATF, United States has firedyet another salvo to squeeze Pakistan economically.
Secretary of State Mike Pompeo warning against any bailout package for thecountry from the International Monetary Fund (IMF) which could then bepossibly used by Pakistan to pay off Chinese debts.
In an interview to CNBC, Pompeo said the US is monitoring developments thatcould take place this month related to Pakistan approaching IMF. “Make nomistake, we will be watching what the IMF does.
There’s no rationale for IMF tax dollars — and associated with that,American dollars that are part of the IMF funding — to bail out Chinesebondholders or China itself,” he said.
While the new government in Pakistan – set to take oath on August 11 – islikely to cosy up to China, it is also in dire need of a financial bailoutpackage. Many expect the Imran Khan-led government to approach IMFimmediately after officially coming to power. The country has alreadyreceived 12 bailout packages from IMF so far.
In case IMF shuts its doors, the country may have to further lean on Chinato borrow much-needed funds. There are already reports in Pakistani mediathat China has agreed to pour in more foreign exchange – over and aboveCPEC funding.