Pakistan can learn some lessons from Argentina
ARTICLE (May 17 2010): The majority of Pakistanis would almost certainly be unable to place Argentina on a global map. However, those angered by recent foreign policy actions of the Western nations in general and Britain in particular, and disappointed by their government's slavish acceptance of all the rigid anti-poor conditions set by the International Monetary Fund in return for bailout money, may well recall two major decisions taken by Argentina: the 74-day war with Britain over the Falkland islands which Argentina lost and its decision in 2002 to go off the IMF programme.
The Malvinas islands, as they are referred to in Argentina, are an archipelago located in the south Atlantic with both Argentina and Britain claiming the right to rule. In 1945 when Argentina signed the UN charter, it reserved the right to sovereignty over the islands and its right to recover them. Britain, in turn, stated that its withdrawal after over 150 years would be conditional on a referendum - an essential precondition for the fulfilment of the UN Resolution 1514 (XV) on de-colonising all territories still under foreign occupation. The islanders of British descent reportedly prefer that they remain a British territory. In 1982, Argentina went to war with Britain over the islands and lost - a pyrrhic defeat that led to the collapse of the then government.
Recently, the government of Argentina raised the issue of ownership of the islands once again. Many consider the trigger to be the decision of the British government to send an oil platform to the territory to explore under its waters. The Malvinas, it is thought, may have up to 60 billion barrels (9.5 billion cubic metres) of oil under the seabed surrounding them. It is relevant to note that in 2007, Argentina withdrew from the agreement with Britain that set the terms for exploitation of offshore resources.
Argentina raised this issue in a Latin American summit where regional leaders voiced rhetorical solidarity and opposition to colonialism. Hillary Clinton, US Secretary of State, stated on 1 March 2010 while on a visit to Buenos Aires: "the US would like to see both the countries sit down and resolve the issues between them in a peaceful and productive way". This statement is being hailed in Buenos Aires as favouring Argentina as it reopens the question of the islands future.
What are the lessons learned for Pakistan with respect to the simmering Kashmir dispute is the obvious question. Kashmir cannot possibly be equated with the Malvinas islands for three reasons: Indian rule over Kashmir has not been as long as British rule over the Falklands, there are no human rights violations in Malvinas unlike in Kashmir reflecting the lack of any indigenous freedom movement and the UK in this instance at least agrees to abide by the UN Resolution on decolonizing.
Commonalities, of course, are military engagement, the attempt to internationalise the issue by the militarily weaker country that does not have control over the territory and the reluctance of the US to be drawn into negotiating a deal between the protagonists.
In spite of differences and commonalities, Pakistan can draw some valuable lessons from Argentina in its handling of the Malvinas islands: efforts to internationalise the Kashmir issue must be regional, considering Pakistan suffers a distinct disadvantage given India's pervasive influence in the South Asian region maybe the focus should shift to Central Asia; to the Muslim world at large as well as on the US to act as an impartial mediator.
It is unfortunate that Clinton's visit last year focused almost exclusively on the drone strikes and the controversial clauses of the Kerry-Lugar bill. While these two are major issues for the country, yet a third, Kashmir should have been part of the agenda. This, of course, is easier said then done given Pakistan's disadvantages vis-a-vis India in terms of our system of government, which has witnessed only periodic bouts of democracy, the style of governance, which remains autocratic, riddled with corruption and nepotism be it during military dictatorships or democracy, and a small market as compared to India's, which is not in any country's interest to woo. It is indeed unfortunate that Taliban, the biggest threat to our state as well as the West, are the only focus of Western interest in this country.
The IMF and its handling by Argentina, given the fact that Pakistan is currently on an IMF programme merits a look. Argentina went off the IMF programme in 2003. In contrast, Dr Hafeez, the newly appointed Advisor to the Prime Minister on Finance, has indicated that Pakistan may borrow more from the IMF to pay back the 14 billion dollar plus ongoing IMF Stand-By Arrangement.
In a meeting with Ambassador Tomas de Anchorena, Ambassador Sadous and Dr Eve Rimoldi in Argentina, this columnist was informed that Argentina, after it was compelled to go off the IMF programme, undertook four policy actions. First and foremost, it cleared its debt to the Fund.
This, the government of Pakistan would have to do if it goes off the programme. Is this doable for us? The answer is yes it is doable if the government mercilessly slashes expenditure and raises revenue by ending exemptions on the rich and influential. Argentina, in its effort to control expenditure, went so far as to shut down 12 to 15 of its embassies.
Second, Argentina government focused on pro-poor policies, considered necessary, as the poor were the hardest hit by Argentina's economic meltdown and the subsequent IMF programme. Poverty levels were higher than 50 percent at the time, rates that the government claims have come down to 20 percent - a figure that Anchorena, Sadous and Dr Rimoldi challenged by asserting that the correct figure was probably closer to 30 percent.
Poverty, they further revealed, was tackled by a direct government subsidy to the poor families (on the same pattern as the Benazir Income Support Programme). An evaluation of this subsidy reveals that it has increased dependency with a consequent negative impact on productivity. In other words people would rather stay home and receive this subsidy then go out and actively look for work. Perhaps, the BISP needs to provide adequate safeguards to ensure that this does not happen in Pakistan.
Third, Argentina subsidised nearly all public sector services namely transport, electricity and gas, which led to 'tremendous distortions.' In contrast, Pakistan is embarked on a path towards zero subsidies in accordance with the IMF conditions: in the budget for fiscal year 2008-09 total subsidies were around 295.2 billion rupees, while revised estimates placed them at 252 billion rupees. In the ongoing fiscal year, subsidies were to be reduced drastically to 131.9 billion rupees, however, it is not yet known whether the government did achieve this target. Be that as it may the impact on the poor of reduced subsidies has been considerable. The IMF claims that subsidies must be better targeted and that indeed is sound advice.
Pakistan can learn some lessons from Argentina
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