Lahore: The Pakistan Economy Watch (PEW) on Tuesday expressed grave concern over retreat of rupee and suggested some control on free movement of foreign exchange to stop erosion in the value of local currency.
The political situation is contributing to the devastation of economy while massive flight of capital is resulting in depleting exchange rates which must be stopped by restricting movement of dollar, said Dr. Murtaza Mughal, President PEW.
Temporary exchange controls can defuse the situation otherwise it will have a negative impact on masses and every segment of the economy besides ransacking central bank’s reserves, he said.
Dr. Murtaza Mughal said that the IMF’s stabilisation programmes have always encouraged speculators and helped flight of capital from developing countries majority of whom have failed to protect their economies due to harsh conditions imposed by the Washington-based lender.
He said that the IMF-backed liberalisation of foreign exchange regime has destroyed dozens of economies, some to the extent that they had no option but to officially replace their local currency with US dollar.
IMF creates crisis in a country, come forward with its lethal prescription and then push governments into anti-development stabalisation programmes compressing the standard of living in countries where many lives below the poverty line.
The economic medicine of IMF has served no purpose but crumbled purchasing power of the masses, destroyed industrial base, speedy privatisation, crippled local manufacturing, and driving businesses into bankruptcy due to high interests rates resulting in rapid recolonisation of dozens of economies.
Our policymakers should act before the crisis having devastating economic and social consequences reach a new climax hurting our economic credibility beyond recovery, warned Dr. Mughal.