Wednesday Mar 29, 2023
Minister for Finance and Revenue Ishaq Dar Wednesday met the United Arab Emirates (UAE) top diplomat in Pakistan as the country scrambles to unlock the stalled International Monetary Fund (IMF) programme.
The meeting comes as the IMF, according to Prime Minister Shehbaz Sharif, wants external financing commitments fulfilled from friendly countries before it releases bailout funds.
The Washington-based lender has been in talks with the Pakistani authorities since end-January to resume the $1.1 billion loan tranche held since November, part of a $6.5 billion Extended Fund Facility (EFF) agreed upon in 2019.
The IMF funding is critical for Pakistan to unlock other external financing avenues to avert a default on its obligations. The State Bank of Pakistan's (SBP) reserves are at a critical level of $4.6 billion and cover four weeks of imports.
An IMF statement said substantial progress had been made in discussions towards policies in recent days and financial assurances were standard in IMF programs.
"All IMF program reviews require firm and credible assurances that there is sufficient financing to ensure that the borrowing member's balance of payments is fully financed in the next 12 months, with good prospects for financing over the remainder of the program. Pakistan is no exception," the statement to Reuters said.
Several friendly countries — including Saudi Arabia, China and the UAE — have made commitments to help Pakistan fund its balance of payments as the nation tries to avert a possible default.
IMF’s Director of Strategic Communications Julie Kozack has said that timely financial assistance from external partners is critical to support the authorities' policy efforts and ensure the successful completion of the review with Pakistan.
In a statement, the Ministry of Finance said UAE's ambassador to Pakistan, Hamad Obaid Ibrahim Salim Al-Zaabi, called on the finance minister in Islamabad.
The two sides exchanged views on further enhancing bilateral economic and financial relations between the two countries, the statement read.
The UAE is among Pakistan's largest trade partners and has supported the nation financially in the past with deposits in the State Bank of Pakistan.