Wednesday, October 8, 2008

Iceland, and now Pakistan, teetering on the brink of bankruptcy. U.S.A. next.

    Pakistan's foreign exchange reserves are so low that the country can only afford one month of imports and faces possible bankruptcy.

    Islamabad - Officially, the central bank holds $8.14 billion (£4.65 billion) of foreign currency, but if forward liabilities are included, the real reserves may be only $3 billion - enough to buy about 30 days of imports like oil and food.

    Nine months ago, Pakistan had $16 bn in the coffers.

    The government is engulfed by crises left behind by Pervez Musharraf, the military ruler who resigned the presidency in August.

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