The global economic system is currently facing astonishing changes that have disrupted political, economic, social, and ethical matters worldwide. Financial experts worldwide acknowledge that the dominance of the dollar is gradually diminishing. Alternative currencies have rapidly increased in value, displacing the dollar. Instead of supporting underdeveloped and developing countries, international institutions like the IMF and the World Bank have placed them under the shackles of the dollar.
Various countries worldwide are beginning serious efforts to promote alternative local currencies over dollar dependency. This challenge to the dollar is an open rebellion against the hegemony of the IMF and the World Bank. The wheel of change never stops turning. While currencies like the Chinese Yuan, Euro, and others face challenges against the dollar, the status of the dollar is under threat.
Following the Second World War, the IMF and the World Bank were established to hold the reins of the global financial system. These institutions, primarily sponsored by the United States, align with Washington’s agenda. They are run by individuals who always follow American directives. Western nations, being mostly capital-rich, protect capital and its interests. The IMF and World Bank’s policies ensure the protection of capital and its benefits.
Western powers employ the IMF and the World Bank to pursue political agendas. Leaders and governments are constrained by these institutions. They impose restrictions on credit lines, bailout packages, and project funding, even when they do not align with their desires. African, South American, and even Asian countries that organize their foreign policy according to Washington’s agenda receive relief from the IMF.
Unwanted countries face restrictions and are penalized, despite these financial institutions initially being established to provide mutual assistance, prevent wars, and support the financial development of nations. However, in the face of ongoing political and economic conflicts in the world, the practical roles of the IMF and the World Bank cannot be overlooked.
Despite global restrictions on money laundering and illegal activities, Western nations, with their loyal allies, are an exception. Centers of power are currently undergoing transformations, and the struggling economies are being propped up by global financial institutions such as the IMF and the World Bank to prevent the expected change.
Instead of helping poorer countries progress, America has tried to use its dominance to shape the world order in its favor, even forcing poorer nations into the constraints of IMF loans and credit lines. China’s economic development is a unique case in the world economy. A country rooted in communism and socialism became the largest economic power in the world.
China’s model is a blend of socialism and capitalism. In a very short time, China lifted millions of its citizens out of poverty. Today, the average household income of every Chinese family is more than thirteen thousand dollars per month. In 2022, 58% of global financial reserves were in dollars, which will significantly reduce with the rise of the Chinese Yuan. The Asian Monetary Fund and similar institutions are emerging as alternatives to the IMF.
New alliances and economic blocks are forming worldwide. Despite the United States’ many efforts, it has not been able to stop China’s rapid progress in the global economy. At times, new political unions are being formed to counter China’s influence, and at other times, economic blocs are established to curb this economic powerhouse. Pakistan is a strategically located country and benefits from opportunities and capabilities. However, Pakistan’s geographical importance is not the only reason both China and the U.S. are keen on using it for their respective purposes.
Both the United States and China are vying for Pakistan’s support, and Pakistan’s political and economic interests are deeply rooted in both of them. This is both our fortune and our misfortune. The tug of war between divine powers such as the United States and China is leaving Pakistan stuck in the middle, which is forcing Pakistan to serve their political and economic interests. Pakistan, along with other nations affected by the IMF and World Bank, is at the forefront. Due to its massive debt burden, Pakistan is unable to stand up against the global superpower, the United States.
The end of American dominance will pave the way for a new economic future for Pakistan and the rest of the world. Until then, organizations like the IMF will make every effort to keep countries like Pakistan in their grasp, although these attempts may prove futile this time.
