Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Cash-Strapped Pakistan To Receive $500 Million From Chinese Bank

Cash-Strapped Pakistan To Receive $500 Million From Chinese Bank

Chinese banks have already provided re-financing of USD 1.2 billion in commercial loans in the past few weeks.
A Chinese bank has assured Pakistan that it will provide another refinanced USD 500 million loan within the next few days, bringing the total of commercial loans up to USD 1.7 billion out of the total committed amount of USD 2 billion, The News International reported.

The Pakistani authorities are running from pillar to post to get 100 per cent confirmation from friendly donor countries and multilateral creditors before moving toward striking a staff-level agreement with the International Monetary Fund (IMF). It was an unwritten condition from the IMF that Pakistan must secure the refinancing of commercial loans as well as a rollover on deposits from China during the programme period, which is scheduled to expire in June 2023.

"Another USD 500 million commercial loan is coming from a Chinese bank," a top official of the Pakistan Finance Division confirmed on Wednesday and added that it would be done soon, The News International reported.

Chinese banks have already provided re-financing of USD 1.2 billion in commercial loans in the past few weeks, and now Beijing has given an assurance on another USD 500 million in loan re-financing in the next few days.

It is relevant to mention that Pakistan had also requested to grant rollover on the Chinese SAFE deposit of USD 2 billion within the ongoing month.

All these, the refinancing of commercial loans and rollovers on SAFE deposits, are pre-requisite for moving towards the signing of a staff-level agreement between the IMF and Pakistani side.

Now Pakistani authorities are anxiously waiting for confirmation from the Kingdom of Saudi Arabia, the UAE, and Qatar, as well as from the World Bank and the Asian Infrastructure Investment Bank (AIIB), for fulfilling their external financing needs of USD 6 billion until the end of June 2023, The News International reported.

The guarantees for securing external financing are crucial for the sustainability of the IMF programme, as it is quite hard for the State Bank of Pakistan to jack up its foreign exchange reserves to USD 8-10 billion by the end of June 2023. Though the staff had projected them at USD 16 billion in August 2022, in the aftermath of completing the seventh and eighth reviews under the USD 6.5 billion Extended Fund Facility.

It will be quite difficult for the IMF staff to defend a 50 per cent reduction in the foreign exchange reserves held by the State Bank of Pakistan (SBP) when there have been no shocks to the economy of Pakistan on the external front. But Pakistani authorities argued that the flash floods had struck many parts of Pakistan, causing USD 30 billion in losses to the economy.

There is one good news for Pakistan's economy: Brent crude is down at USD 74.39 and West Texas Intermediate (WTI) is down at USD 68.16 per barrel in the international market.

Meanwhile, the IMF secretly launched "Inclusive growth in the Middle East/North Africa (MENA) region" here at the National University of Sciences & Technology (NUST) on Wednesday, in which presentations made by the IMF high-ups who argued that wherever state-owned enterprises (SOEs) possessed a major footprint, it resulted in the crowding out of the private sector.

Pakistan's budget makers also assured the IMF that they would be preparing gender-based budgeting in the next financial year.

At a time when the IMF is dwelling on its focus on inclusive growth in its launched books, practically under the IMF's tight scrutiny, the development budget of the federal government, known as the Public Sector Development Program (PSDP), was slashed by 50 per cent for the current fiscal year in line with the Fund's demand to curtail the budget deficit target.

To fulfil the IMF's demands, the consumer price index (CPI) -based and Sensitive Price Indicator (SPI)- based inflation has gone up to unprecedented levels of 31.5 per cent every month, and 42.3 per cent every week.
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Poland Implements Border Checks Amid Growing Migration Tensions
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
China Unveils Miniature Insect-Like Surveillance Drone
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Massive Anti-Government Protests Erupt in Belgrade
Iran Executes Alleged Israeli Spies and Arrests Hundreds Amid Post-War Crackdown
Hungary's Prime Minister Criticizes NATO's Role in Ukraine
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Hungarian Scientist to Conduct 30 Research Experiments on the International Space Station
NATO Members Agree to 5% Defense Spending Target by 2035
NATO Leaders Endorse Plan for Increased Defence Spending
U.S. Crude Oil Prices Drop Below $65 Amid Market Volatility
International Astronaut Team Launched to Space Station
Macron and Merz: Europe must arm itself in an unstable world
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Iran Intensifies Crackdown on Alleged Mossad Operatives After Sabotage Claims
Trump Praises Iran’s ‘Very Weak’ Response After U.S. Strikes and Presses Israel to Pursue Peace
Oil Prices Set to Surge After US Strikes Iran
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
Labubu Doll Drives Pop Mart to Status as China’s Most Valuable Toy Maker
Global Coal Demand Defies Paris Accord Goals
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
Telegram Founder: I Will Leave My Fortune to Over 100 of My Children
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
Hungary Ranked Among the World’s Safest Travel Destinations for 2025
G7 Leaders Fail to Reach Consensus on Key Global Issues
FBI and Senate Investigate Allegations of Chinese Plot to Influence the 2020 Election in Biden’s Favor Using Fake U.S. Driver’s Licenses
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
Shock Within Iran’s Leadership: Khamenei’s Failed Plan to Launch 1,000 Missiles Against Israel
Wreck of $17 Billion San José Galleon Identified Off Colombia After 300 Years
×