IMF sounds alarm on UK tax cut plans
The International Monetary Fund has openly criticised the UK government over its plan for tax cuts, warning that the measures are likely to fuel the cost-of-living crisis, BBC reported.
In an unusually outspoken statement, the IMF said the proposal would be likely to increase inequality and add to pressures pushing up prices.
Markets have already raised alarm over the plans, sending the pound plunging.
The government says the measures will kickstart economic growth.
Chancellor Kwasi Kwarteng unveiled the country's biggest tax package in 50 years on Friday. The £45bn cut will be funded by government borrowing.
The IMF works to stabilise the global economy, and one of its roles is to act as an early economic warning system.
"Furthermore, the nature of the UK measures will likely increase inequality," it said.
The IMF said that the government publishing a fiscal plan on 23 November gave it an opportunity to "re-evaluate" tax measures, "especially those that benefit high income earners".
The UK government proposals would scrap the top rate of income tax, and end a cap on bankers' bonuses, among other measures.
The announcement on Friday sparked days of financial turmoil, as investors dumped the pound and UK debt. On Monday the pound fell to record lows against the dollar.
Some of the country's biggest lenders suspended mortgage deals amid the uncertainty.
It added that Mr Kwarteng was due to publish his medium-term plan for the economy on 23 November, which would include ensuring that UK debt falls as a share of economic output in the medium term, according to BBC.
Meanwhile, Lord Frost, the former Brexit minister and close ally of Prime Minister Liz Truss, criticised the IMF's statement.
He told the Daily Telegraph: "The IMF has consistently advocated highly conventional economic policies. It is following this approach that has produced years of slow growth and weak productivity.
"The only way forward for Britain is lower taxes, spending restraint, and significant economic reform."
BBC economics editor Faisal Islam says the IMF's "stinging rebuke... reflected similar concerns from the world's major finance ministries that a crisis brewing in the UK could spill over into a global slowdown".
Its chief economist Huw Pill said the Bank "cannot be indifferent" to the developments of the past days.
He said the Bank would have to deliver a "significant monetary policy response" to protect sterling.
Speaking to BBC Two's Newsnight, former US Treasury Secretary Larry Summers described the situation facing the UK as "very ominous".
"I can't in all honesty remember a time when a set of policy announcements from a G7 country elicited so negative a response both from markets and from economic experts," he said.
"When a country sees its interest rates rise by [as much as they have] in two days at the same time that its currency is falling in a major way, that is a sign that there has been a major loss of market credibility and market confidence.
"The kind of warning that Britain received from the IMF today is a kind of warning that comes much more frequently to emerging markets with new governments than to a country like Britain."
Asked about the UK's plans at an event in Washington, White House economic adviser Brian Deese said he had not been surprised by the negative reaction of the markets and that it was important to focus on "fiscal prudence, fiscal discipline", the Reuters news agency reported, BBC reported.
Moody's credit rating agency said on Wednesday that the UK's plan for "large unfunded tax cuts" was "credit negative" and would lead to higher, persistent deficits "amid rising borrowing costs [and] a weaker growth outlook". Moody's did not change the UK's credit rating.
Ukraine war: Russia to open war enlisting hub on Georgia border
Russia is to open an army enlisting centre on the border with Georgia, where massive queues have formed as Russian men try to flee the country to avoid being sent to fight in Ukraine, BBC reported.
Officers at the Verkhniy Lars crossing will be tasked with serving summons to "citizens of the mobilisation age", the authorities say.
Recent satellite images have shown queues going for miles from Russia.
All those crossing into Georgia look exhausted, a BBC correspondent says.
They are hungry and sleep deprived - but relieved to have reached safety, Rayhan Demytrie says. People have been coming in groups of walkers, dragging their suitcases behind them. Others have arrived in car or on bikes.
One man, Ilya, showed our correspondent a polaroid of his baby daughter Arisha. He said he wanted to see her grow up, and not die in the senseless war in Ukraine.
Another young man from Moscow said the reason he was fleeing was because of the man in the Kremlin, President Vladimir Putin.
Everyone says the same thing: they disagree with the war - but the extent of repression in Russia makes them powerless, our correspondent says.
The interior ministry of Russia's North Ossetia republic, where the Verkhniy Lars crossing is, said 60 of its personnel had already been deployed there, describing the situation as "extremely tense".
It added that the army enlisting centre would be opened "in the nearest future".
Kazakhstan's President Kassym-Jomart Tokayev vowed on Tuesday to protect the safety and welfare of Russians fleeing a "hopeless situation".
The Russian defence ministry on Tuesday said it would not seek the extradition of Russian nationals travelling abroad to avoid being drafted into the army, according to BBC.
President Putin announced what he described as a partial mobilisation on 21 September, with Defence Minister Sergei Shoigu later saying 300,000 reservists would be called up.
But reports in opposition Russian media suggested that up to one million people could be called up, pointing out that the actual number of those who would be enlisted was classified.
A number of military experts in the West and Ukraine say Mr Putin's decision to call up reservists shows that Russian troops are failing badly on the battlefield in Ukraine - more than seven months after Moscow launched its invasion.
"There are cases when the decree is violated," Mr Putin's spokesman Dmitry Peskov said, adding that "all the errors will be corrected".
On Tuesday, Sergei Baranovsky, the top official responsible for war mobilisation efforts in the extreme north-eastern Magadan region, was sacked.
Multiple reports - backed by footage on social media - say people with no military experience, or who are too old or disabled, are being called up.
Since the mobilisation announcement, more than 2,000 people have been detained at protests across Russia.
"We are deeply disturbed by the large number of people who have reportedly been arrested," UN rights office spokeswoman Ravina Shamdasani said on Tuesday, BBC reported.
In one of the most shocking and widely-discussed incidents, a man shot and critically injured an army recruitment officer in the Siberian city of Ust-llimsk on Monday.
EC carrying out homework to fix election expenditure ceiling
The Election Commission is doing homework to fix the election expenditure limit for the candidates and parties for November 20 elections to the House of Representatives and Province Assembly as per the Election related law and code of conduct. The EC held consultation with political parties today in this regard. Chief Election Commissioner Dinesh Kumar Thapaliya said that a decision would be taken after holding discussions on the suggestions received from the political parties. The political parties suggested increasing the expenditure limit fixed for the HoR and Province Assembly election held in 2074 BS and that expenditure limit for different constituencies should not be the same. Chief Election Commissioner Thapaliya expressed the belief that political parties and candidates would follow expenditure ceiling fixed by the EC and as per the code of conduct. Clause 24 of the Election Commission Act-2073 has the provision that the EC could determine the election expenditure limit. Similarly, clause 25 of the same Act mentions that it is the responsibility of the political parties and candidates to submit the election expenditure details and they have to submit the expenditure details within 30 days at the respective election office after the announcement of the final result of the election. The EC has taken action against 123,624 candidates of local-level election held on May 13 and charged up to Rs 750,000 as fine for not submitting their expenditure details.
At UNGA, Paudyal stresses the need for immediate implementation of climate finance goals to address climate crisis
Foreign Secretary Bharat Raj Paudyal, head of Nepali delegation, addressed the 77th session of the United Nations General Assembly in New York on Monday. In his address, the Foreign Secretary outlined the threats to global peace and prosperity arising from the COVID-19 pandemic, geopolitical tensions, inequalities, and climate crisis and stressed for stronger solidarity and cooperation in the international system to overcome them. Accentuating pandemic control as the top priority for the world, he called for vaccine equity and universal vaccination to save lives. He said that Nepal had vaccinated more than 96% of the target population while thanking neighbours, India and China as well as development partners for supporting Nepal in the achievement of this milestone. The Foreign Secretary stated that the interlinked global challenges seriously hampered the achievement of sustainable development goals, particularly for the countries in special situation like the LDCs, LLDCs, and SIDs. He mentioned that Nepal was on the path of graduation from the LDC category, in spite of the huge investment and capacity gaps for structural economic transformation and implementation of SDGs. He called for enhanced level of development assistance, foreigninvestment, debt relief, aid for trade, and technology transfer in support of Nepal’s graduation process. He also stressed the need for immediate implementation of climate finance goals to address the climate crisis faced by developing countries and reiterated Nepal’s commitment to achieving net zero emission by 2045, as expressed by the Prime Minister in CoP26 in Glasgow. He also urged for reforms of international financial architecture for an equitable economic order. In his statement, the Foreign Secretary reiterated Nepal’s principled position on peace, security, and disarmament. Expressing concerns over the rising military expenditure in the world, he called for general and completed disarmament. He underlined Nepal’s opposition to threat or use of force against sovereignty, territorial integrity,and independence of any nation. He condemned terrorism in all its forms and manifestations and called for an early conclusion of a comprehensive convention against terrorism. The Foreign Secretary reiterated Nepal’s unwavering commitment to human rights. He mentioned that the Constitution of Nepal had guaranteed universally recognized human rights and fundamental freedoms andhad enshrined the principles of inclusion and participation. He also shared Nepal’s commitment to conclude transitional justice by addressing the concerns of the victims, complying with the directive of the Supreme Court, and abiding by the spirit of the Comprehensive Peace Accord and country’s relevant international commitments. Paudyal expressed concerns about the situation in Ukraine, Afghanistan, Myanmar, Libya, Syria, Yemen,and the Middle East and urged all parties involved to ensure peace, security, and stability. The Foreign Secretary said that Nepal is committed to promoting peace, security, and stability. Referring to Nepal’s contribution to the UN peace operations as the second largest troops and police contributing country, he expressed support for initiatives aimed at reforming UN peace operations. Condemning attacks against the peacekeepers, he underlined the importance of their safety, security, and dignity as well as the need for adequate training, resources, and modern technologies. The General Debate of the 77th Session of UNGA is being held at UN Headquarters in New York from 20 to 26 September under the theme A Watershed Moment:Transformative Solutions to Interlocking Challenges.
