The United States, behind the scenes, put in a good word with the IMF to give Pakistan a pass on its June 30, 2023 payment deadline. And once the IMF was informed of the U.S. secret deal with Pakistan to provide $900 million of munitions to the U.S. for passing along to Ukraine, the IMF allowed Pakistan to count that otherwise secretive income for the purposes of meeting the IMF’s conditions. So reports The Intercept.
The very same U.S. State Department official Donald Lu, who in the early spring of 2022 gave the instructions to Pakistan’s U.S. ambassador that Prime Minister Imran Khan had to be dumped, made the arrangements in late May 2023 for Pakistan to get credit with the IMF. On the earlier occasion, Lu had evidently given as the reason for dumping Khan, that he was “aggressively neutral” on Ukraine. Shortly after Khan was ousted, with a vote of “no confidence,” the first of $900 million in munitions began heading for Ukraine. Now it appears that playing ball with the “keep Ukraine fighting to the last Ukrainian” also scores points with the IMF.
The Intercept writes on Sept. 17: “On June 29, a day before the original program was set to expire, the IMF made a surprise announcement that instead of extending the previous series of loans and releasing the next $1.1 billion installment, the bank would instead be entering an agreement—‘called a Stand-By Arrangement’—with fewer strings attached, more favorable terms, and valued at $3 billion.” However, “more favorable” than the previous agreement doesn’t mean “favorable"—Pakistan still had to remove all support for energy and allow its currency to freely float. Energy costs doubled almost immediately.
