Pakistan Needs More Than an IMF Bailout to Fix Its Ailing Economy

Investors have warmed to Pakistan since the government secured a $6bn bailout from the IMF in July, removing any immediate threat of sovereign default, the Financial Times reported. MSCI’s Pakistan equities index is up more than a third from its August lows, compared with a gain of just over 10 per cent for MSCI’s flagship emerging market index. Foreign investors have made a tentative return to the country’s local debt market, buying $1.2bn of local currency government bonds since July after staying away for most of the past two years. But the ailing south Asian economy will need more than the IMF’s aid to solve its chronic problems. Pakistan has been trapped for years in a boom and bust cycle in which no growth spurt has lasted more than four years. Read more