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40,000 Factories At Risk Of Closing In Pakistan’s Commercial Capital Amid Fuel Crisis
40,000 Factories At Risk Of Closing In Pakistan’s Commercial Capital Amid Fuel Crisis
Pakistan faces potential economic collapse as inflation jumps and widespread civil unrest could be nearing. The latest sign the South Asian country is spiraling into the abyss is rising electricity costs that threaten to close tens of thousands of businesses.
Bloomberg reports that as many as 40,000 factories in Karachi, the country’s commercial capital, are being slapped with high power costs that make operating near impossible.
Rising power costs are so severe that nine business groups in Karachi told the government that an immediate plan needs to be formulated to lower power costs or face economic disaster.
Any shuttering of factories and mass layoffs could trigger social unrest in the commercial capital, home to more than 16 million people.
Discontent among businesses and households is already soaring with an official inflation rate of over 13.37% (double the official CPI to get a more accurate picture of true price inflation), the 2nd fastest-rising rate in Asia.
On top of high power costs, Karachi’s power utility — K-Electric Ltd. — warned customers of widespread power cuts for the first time in over a decade if power generation continues to struggle because of high fuel costs and supply shortages.
“These current conditions are severely hindering KE’s ability to procure fuel, causing a permanent curtailment of power generation” that translates to as much as 10 hours of planned blackouts for some parts of the city, said Sadia Dada, a spokesperson for K-Electric.
Pakistan is also a nuclear power — political elites may stoke a conflict with neighboring India to distract public anger from domestic financial pain.
Are Gas Shortages Coming to America?
Are Gas Shortages Coming to America?
Gas shortages could be coming to America…and quickly.
An unexpected fuel crisis has hit Canada. According to a Canadian blogger andauthor, not one, but two, fuel tankers were inexplicably delayed last week, and shortages ensued alarmingly quickly, with numerous gas stations running completely out of fuel within a matter of days. Marie Beausoleil wrote:
The delay was long enough that gas stations across Nova Scotia ran out of gas, even with a week of rationing. The gas stations knew the tankers were going to be late and starting rationing in advance.
By Thursday, storage tanks in the city of Dartmouth were empty.
The tankers arrived on Friday and started the process of unloading.
By Saturday the shortage had spread to the smaller communities, the less busy gas stations.
By Sunday evening, motorists across the province were stranded and “Out of gas” signs were everywhere. It would take, people were warned, at least a week to get all service stations filled across the province (and if you’re not familiar with it, Nova Scotia is a very small place!) (Check out the rest of the article HERE)
If you couple a potential fuel shortage with the dramatic instability of the US stock market, it sure doesn’t paint a sunny forecast for the American economy.
A major fuel shortage could send epic economic shockwaves across the country, since our economy is based on cheap oil.
It all boils down to this: the transportation system.
- If we can’t transport goods, businesses will have nothing to sell.
- If businesses have nothing to sell, they can’t keep their staff employed.
- If people have no work, they have no money.
- If a few items are available, they will be outrageously expensive and not many folks will be able to afford the goods.
- If you DO have money, you still have very little to buy.
Lots of people like to shake their heads and say, “Oh, this won’t hurt me at all.” That’s pretty shortsighted, because a fuel shortage will affect EVERYONE. CDL Life News recently published this alarming infographic.
…click on the above link to read the rest of the article…
