IMF chief Kristalina Georgieva called on Pakistan to tax the wealthy and protect the poor during a meeting on the sidelines of the United Nations General Assembly. It remains to be seen whether the Pakistani government will be able to implement the reforms demanded by the IMF
The head of the International Monetary Fund (IMF) has urged Pakistan to tax the wealthy and protect the poor in order to reduce inequality and promote economic growth. Kristalina Georgieva, the IMF chief, said that Pakistan needed to “raise more revenue from the wealthy”. And “spend more on social protection” in order to help the country recover from the COVID-19 pandemic and recent floods.
Georgieva’s comments come as Pakistan is facing a severe economic crisis, with high inflation and unemployment. The IMF has agreed to provide Pakistan with a $6 billion loan. But only on condition that the country implements a number of reforms, including tax reform.
Separately, Georgieva also posted on social media platform X, formerly known as Twitter, after meeting with Pakistan’s caretaker prime minister Anwaar-ul-Haq Kakar.
“Very good meeting with Pakistan’s PM today on Pakistan’s economic prospects,” she said. “We agreed on the vital need for strong policies to ensure stability, foster sustainable and inclusive growth, prioritize revenue collection, and protection for the most vulnerable in Pakistan.”
Some critics have argued that the IMF’s demands will disproportionately impact the poor. However, Georgieva has defended the IMF’s position, saying that there is no trade-off between macroeconomic stability and social justice.
The caretaker government of Pakistan initially denied that the inflated bills were a problem. Then promised to provide some relief, but later ruled it out due to the country’s commitments to the IMF. The IMF also rejected the interim government’s proposals to provide relief to the people amid soaring inflation and skyrocketing food and energy prices.
It remains to be seen whether the Pakistani government will be able to implement the reforms demanded by the IMF. However, Georgieva’s comments suggest that the IMF is serious about helping Pakistan to overcome its economic crisis.