Pakistan Acute Crisis Ongoing

Sept 15, 2010. AP:



Consequences:

Mr. Holbrooke and the Australian foreign minister, Kevin Rudd, visited Kot Addu, a hard-hit area in the Muzaffargarh district, where they observed field hospitals and camps.

“I have seen many disasters in my life, but I have never seen this kind of disaster where people are now camping along the roads living in desperate conditions,” Mr. Holbrooke said.

Complications:

KARACHI, Pakistan — The world will only be able to fund around 25 percent of the tens of billions of dollars needed to rebuild Pakistan after the floods, and its government will have to make up the shortfall, the U.S. envoy to the country warned Thursday.

Richard Holbrooke said America would not condition its assistance to the country, but warned that the U.S. Congress might not be generous if it felt that Pakistan was not taxing its own citizens enough.

Pakistan's rich have traditionally not paid much tax on their income or their property — either because they evade them or are exempt — and the country's collection rates are among the lowest in the world. Critics have pointed to this shortage of revenue in recent weeks as Pakistani leaders have sought international aid. The country's economy is surviving on international assistance, and the floods are expected to badly slow economic growth further.

"I don't want to withhold money they need, but I think we have to be clear that the Congress is going to be reluctant to give money if the money is filling in a gap because people are not paying taxes," said Holbrooke during a visit to Karachi.