Obama’s First Big Test: Pakistan

A senior American official was asked a few days ago whether there were places where the global economic mess could aggravate security problems. He answered without hesitation: “Pakistan.”

That is the concern to keep in mind as President-elect Obama’s transition to power unfolds in coming weeks. The new president’s advisers worry that if there’s an unpleasant foreign-policy surprise that will divert their attention from enormous economic challenges, it could well come in Pakistan.

By Gerald F. Seib
The Wall Street Journal
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It’s a well-founded fear. Pakistan was a tense and worrisome place for America before the world-wide financial mess arrived. The country is, after all, a nuclear-armed Islamic giant run by an unproven new government, beset by internal political rifts, conducting a fitful struggle with Taliban and al Qaeda insurgents along its border with Afghanistan, and threatened by Islamic radicals angry over American military strikes along that same Afghan border. That’s plenty to keep a new president awake at night.

Now those problems are overlaid by new economic woes rippling in from the global financial markets. Inflation is running at 25%. Pakistan’s central bank just raised its key interest rate to 15%, at a time when other central banks are lowering theirs. Pakistan is at risk of defaulting on its national debt and badly in need of a bailout from the International Monetary Fund.

Pakistani policemen at an entry-point in Islamabad in September ... 
Pakistani policemen at an entry-point in Islamabad.(AFP/File/Aamir Qureshi)

All those woes mean that, troublesome as the war in Iraq and the nuclear threat from Iran may be, chances for an immediate crisis for Mr. Obama are indeed highest in Pakistan.

Read the rest:
http://online.wsj.com/article/SB122662045244426437.html

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