WASHINGTON , July 12, 2023: The International Monetary Fund (IMF)’s Executive Board will deliberate upon the $3 billion stand-by arrangement (SBA) reached with Pakistan today (Wednesday).
Although Pakistan wasn’t originally among the subjects listed on the IMF’s website, the external financing issue has been resolved after Islamabad received $2bn deposit from Saudi Arabia a day earlier.
With Pakistan managing to meet one of the key conditions, the finance ministry says the world’s top lender has now accepted the plan that covers the $8.2bn gap.
Sources say Pakistan will get the necessary finances from different sources including Saudi Arabia ($2bn), the United Arab Emirate ($1bn) and $500 million each from the World Bank and the Asian Development Bank.
However, the largest share will come from China as Beijing will provide $3.5 billion, a country that is focusing on Pakistan for reviving the stalled Built and Road project – CPEC.
Earlier, Finance Minister Ishaq Dar had expressed the hope that Pakistan would receive over $1bn as first tranche within 24 hours of the IMF Executive Board’s approval.
The staff-level agreement for the stacovers first nine months – from July to March – of the current fiscal year 2023-24 and was hammered out on the very day [June 30] the previous deal under Extended Financing Facility (EFF) was to expire.
US WELCOMES STAFF-LEVEL AGREEMENT
US State Department spokesperson Matthew Miller on Tuesday said the United States welcomed the progress made between the IMF and Pakistan.
“Our support for the Pakistan’s economic success is unwavering and we will continue to engage with Pakistan through technical engagements and continue to strengthen our trade and investment ties, all of which are priorities for our bilateral relationship.”
“We believe Pakistan has a lot of hard work ahead to be on a long-term sustainable path to economic recovery and prosperity, but we will continue to stand by them through that process,” he added.
Replying to a question, Millar said “the United States does not ask Pakistan or any other country to choose between the United States and China or to choose between the United States and any other country”.
“Our relations with Pakistan build on our close people-to-people ties, and we will continue to seek ways to expand our partnership and economic ties,” he said.
Miller said the US economic cooperation with Pakistan reflected Washington’s vision for the region which comprised of nations that were independent, strong, and prosperous. “Our relationships are based on a spirit of respect and partnership.”