Global Affairs

Putting the squeeze on China via Pakistan loans

By vowing to block any proposed IMF loan to Pakistan that pays off Chinese loans, the US is putting a great deal of pressure on China and putting Pakistan in the crossfire of its economic fight with China.

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LONDON • Mr Imran Khan, Pakistan's former cricket captain and now the country's incoming prime minister, knew all along that the euphoria which accompanied his successful electoral campaign would be short-lived. For most of his government's promises to boost public spending and create an "Islamic Welfare State" depend not so much on his goodwill, but on the International Monetary Fund's generosity in bailing out Pakistan from another looming bankruptcy.

Nonetheless, Mr Khan thrives on being audacious, so he let it be known that, the moment he is sworn into office, he'd ask the IMF for a loan of US$12 billion (S$16.5 billion), dwarfing the 11 previous bailout packages Pakistan received over the past half century.

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A version of this article appeared in the print edition of The Straits Times on August 13, 2018, with the headline Putting the squeeze on China via Pakistan loans. Subscribe