China’s yuan gains IMF reserve status

The International Monetary Fund (IMF) has announced that China’s currency, the yuan, will join the fund’s basket of reserve currencies.

Currently just the US dollar, the euro, the yen and the pound are in the group.

The IMF said the yuan “met all existing criteria” and should become part of the basket in October 2016.

The yuan will now make up part of the IMF’s Special Drawing Rights (SDR) – an asset created by the IMF which serves almost as a currency.

It is used for transactions between central banks and the IMF, and is used to decide the currency mix that countries like Greece, for example, receive when the IMF provides financial aid.

The last change made to the basket was in 2000, when the euro replaced the German mark and the franc.

Read more » BBC
See more »  http://www.bbc.com/news/business-34957580

Why is Bolivia the fastest growing Economy in the Americas?

Bolivia has reduced poverty and inequality more than any country in the Western Hemisphere over the last ten years by increasing the minimum wage 87%, doubling investment in schools and healthcare, and lowering the pension retirement age from 65 to 60. The government paid for these programs by increasing taxes on oil profits from 18% to 82%, which also allowed the country to eliminate its debt and amass the world’s largest surplus. Bolivia is now estimated to have the region’s fastest growing economy this year and next, according to the IMF.

See more » http://www.theguardian.com/commentisfree/2014/oct/14/evo-morales-reelected-socialism-doesnt-damage-economies-bolivia

Learn more » http://www.cepr.net/index.php/blogs/the-americas-blog/bolivias-economy-under-evo-in-10-graphs

Via Facebook

Brics nations to create $100bn development bank

The leaders of the five Brics countries have signed a deal to create a new $100bn (£58.3bn) development bank and emergency reserve fund.

The Brics group is made up of Brazil, Russia, India, China and South Africa.

The capital for the bank will be split equally among the five participating countries.

The bank will have a headquarters in Shanghai, China and the first president for the bank will come from India.

Brazil’s President, Dilma Rousseff, announced the creation of the bank at a Brics summit meeting in Fortaleza, Brazil on Tuesday.

A new player

At first, the bank will start off with $50bn in initial capital.

The emergency reserve fund – which was announced as a “Contingency Reserve Arrangement” – will also have $100bn, and will help developing nations avoid “short-term liquidity pressures, promote further Brics cooperation, strengthen the global financial safety net and complement existing international arrangements”.

The creation of the Brics bank will almost surely create competition for both the World Bank and other similar regional funds.

Brics nations have criticised the World Bank and the International Monetary Fund for not giving developing nations enough voting rights.

One of the goals for the bank – whose creation has been discussed for some time – would be to increase the amount of money loaned to developing countries to help with infrastructure projects.

Courtesy: BBC
http://www.bbc.com/news/business-28317555

Pakistan Economy: Sinking Like A Rock, says Asian Development Bank.

Sinking like a rock: Slim chances of recovery for Pakistan’s directionless economy, says ADB

By Shahbaz Rana / Creative: Anam Haleem

ISLAMABAD: Amid deep-rooted concerns over a “directionless” economy due to failure of the previous government and inability of the caretaker setup to take immediate meaningful steps, the Asian Development Bank has warned that Pakistan’s current growth model is unsustainable that also undermines future prospects.

In its Asian Development Outlook, the Manila-based lending agency has painted an extremely bleak picture of Pakistan’s economy that is “directionless” and immediate recovery chances are almost nil amid a worsening balance of payments position.

“A difficult political situation stalled effective policy response to macroeconomic and structural problems, especially regarding energy, and the end of the government’s 5-year term in mid-March limited political scope for major policy or structural reforms,” it said.

The economic developments in this fiscal year are unfolding along broadly similar lines as previous year, but with “deepening concerns about sustainability and the adequacy of forex reserves”.

A missing link in the ADB’s analysis of political failures is the role of bureaucrats in running the affairs of the government who often do not disclose actual extent of problems to the leadership.

Hopelessness to doom: Pakistan’s journey

Pakistan

by Malik A. Rashid

BBC reported, “The US is so concerned about security in Pakistan that it is considering plans to enter the country to prevent extremists getting hold of nuclear material”. According to Senator McCain, Pakistan’s ISI has connections with the Haqqani network. In his confirmation hearing Lt. Gen. John Allen said he is aware that explosive devises used against American forces in Afghanistancome from Pakistan. Adm. McRaven thinks Pakistanis know where Mulla Omar is. So, the US-NATO has enemies in Pakistan in their cross-hair.

But the war is not the root cause of the predicament Pakistan finds itself in. Declared #12 on the list of failed nations, Pakistan is the 3rd most dangerous country for women. Out of 70 million between 5 to 19 year old Pakistanis, only 30 million go to school. On education and health care together, government spends about 1% of the GDP. Pakistan’s rulers prescribed a low quality education for their public school system to keep commoners from joining the ranks of army officers and bureaucrats.

US have cut aid to Pakistan. Installment of IMF’s loan was declined because the government could not raise taxes. Pakistan’s economy grew by 2.4% in 2010-11, slower than Somalia’s economy which grew 2.6%. Population of the cities continues to rise; so does joblessness.

Since 75% of supplies to US and NATO troops in Afghanistan will be re-routed through North of Afghanistan by the end of this year, not only the war has turned unrewarding for Pakistan’s rulers, it challenges their power and state’s existence.

Army relied heavily on proxy-warriors to influence other countries in the region and manipulated international aid through terrorism, while the generals indulged in enriching themselves. The business empire of the Military Inc. continued to grow at the expense of dwindling electricity supplies while millions of citizens fell below the poverty line. A conflict with the world-powers has shaken the brazen and brutal power structure of Pakistan. …

Read more → ViewPoint

Nationalism or national policy?

by Shahab Usto

We lost half the state territory in 1971 and the other half is threatened by varied internal and external threats. But our state policy continues to reflect the same old duality: employing the security apparatus and building the artefacts of nationalism.

Though our economic team is busy mending the torn deal with the IMF and the military and political leaderships are busy with their US counterparts to reset the button of the Pak-US cooperation shut by the Abbottabad operation, a well-calibrated nationalist fever has touched new heights. The joint parliamentary resolution talks of cutting off NATO/ISAF supplies; the Punjab government has denounced foreign aid, of course without explaining how it would run the foreign-funded projects given the poor health of its finances; the ‘patriotic’ brigade is calling for ending relations with the US and opting for China; and Imran Khan is out staging dharnas (sit-in protests) against the Pak-US alliance on the war on terror.

Yet no one has come up with a blueprint of our national policy dealing with the war on terror and the myriad socio-political crises, using the ‘rare’ national unity that has come about in the wake of the US Abbottabad operation. The same old trick is being played upon us that the monarchs, generals and populists have played in history: using nationalist sentiments to hide rather than resolve national crises. We must avoid this trap because nationalism could be both a reality and an artefact. Let us pick up a few lessons of history to make this point.

Read more : Daily Times

Pakistan: The narratives come home to roost

by Omar Ali
Most countries that exist above the banana-republic level of existence have an identifiable (even if always contested and malleable) national narrative that most (though not all) members of the ruling elite share and to which they contribute.  Pakistan is clearly not a banana-republic; it is a populous country with a deep (if not very competent) administration, a very lively political scene, a very large army, the world’s fastest growing nuclear arsenal and a very significant, even if underdeveloped, economy.  But when it comes to the national narrative, Pakistan is sui-generis.  The “deep state” has promoted a narrative of Muslim separatism, India-hatred and Islamic revival that has gradually grown into such a dangerous concoction that even BFFs China and Saudi Arabia are quietly suggesting that we take another look at things.

The official “story of Pakistan” may not appear to be more superficial or contradictory than the propaganda narratives of many other nations, but a unique element is the fact that it is not a superficial distillation of a more nuanced and deeper narrative, it is ONLY superficial ; when you look behind the school textbook level, there is no there there. What you see is what you get. The two-nation theory and the creation of Pakistan in 712 AD by the Arab invader Mohammed Bin Qasim and its completion by the intrepid team of Allama Iqbal and Mohammed Ali Jinnah in the face of British and Hindu connivance is the story in middle school textbooks and it turns out that it is also the story in universities and think tanks (this is not imply that no serious work is done in universities; of course it is, but the story of Pakistan does not seem to have a logical relationship with this serious work).

Judge Denies Bail to I.M.F. Chief in Sexual Assault Case

By JOHN ELIGON

Dominique Strauss-Kahn, the leader of the International Monetary Fund, was ordered on Monday to be held without bail over allegations that he had sexually assaulted a maid …

Read more : The New York Times

Where did money go, received from all over the world?

by Dr. Ahmed Makhdoom, Singapore

“Pakistan received $23.4 billion of foreign aid in the last decade.”

Where did this money and other billions of dollars that this country has received from all over the world GO?

Has been spent on schools, education – NO! Has it been spent on alleviating the miseries, deprivations and poverty of millions of poor people – NO! Has the money been spent to provide decent Health Care – certainly, NOT! So, where is the money going?

WB and IMF are gladly dishing out billions to these culprits, thieves, robbers, and leeches who rule this country – just for their own benefits and carrying forward their own nefarious, selfish, self-seeking Agenda!

They show the photographs of Sindh, where there is chronic poverty and desease to beg money from WB and IMF.

Once received this money goes to the security establishment and the ugly animals in the Governments! The photograph shows Sindhi innocent infants, toddlers and children crying for food and milk! Height of Inhumanity! Height of Injustice!

Civilised world should take cognizance of thwart is happening in this country. The Security establishment, the Government and tyrants should be taken to the International Criminal Court and tried for crimes against humanity!

Courtesy: Sindhi e-lists/ e-groups, April 19, 2011.

PAKISTAN IN CRISIS

– Ahmed Rashid, Author and Journalist

With the recent assassination of Salman Taseer, governor of the province of Punjab, one of the strongest voices for democracy and secularism in the Pakistan People’s Party has been silenced. The government is in crisis, and the economy has been in freefall since the International Monetary Fund halted its loans to the country last year. Ahmed Rashid warns that the situation in Pakistan is potentially worse than in neighboring Afghanistan. This unrest comes at a crucial time when the United States is seeking increased cooperation with Islamabad on the war in Afghanistan and combating terrorism. What is the future of Pakistan’s partnership with the United States, and what will be Pakistan’s role in defining regional order before NATO pulls out of Afghanistan in 2014? …

Read more : The Chicago Council

Professional Beggars at their best … but .. Beggars are not choosers!

Vice President Joe Biden is the latest high level U.S dignitary to visit Pakistan. As the series of such high profile visits continues, one wonders what actually transpires in such meetings and what kind of assurances are given from both sides to each other. In this episode of Reporter, Arshad Sharif tries to find out what PM Gilani meant when he said that he has given assurances to Joe Biden that practical steps will be taken to resolve all the difficult problems.

Courtesy: Dawn News (program Reporter with Arshad Sharif)

Source- You Tube Link

Pakistan – Rs. 110 billion increase in defense budget!!?!

Govt projects Rs 110bn increase in defence budget

* Consolidated expenditures of federal, provincial govts to increase by Rs 33bn

By Sajid Chaudhry

ISLAMABAD: The government has projected an increase of Rs 110 billion in the defence budget and informed the International Monetary Fund that according to the post-flood situation, the defence budget will be Rs 552 billion against the budgetary allocation of Rs 442 billion for the ongoing fiscal year 2010-11.

This increase in the defence budget has been projected by the government at a time when development and non-development budgets of the civil government are being slashed by 50 percent and 20 percent respectively to create fiscal space for the rehabilitation of the flood-affected population. …

Read more >> Daily Times