According to Finance Minister Ishaq Dar, the United Arab Emirates (UAE) has affirmed to the International Monetary Fund (IMF) that it will pay $1 billion in assistance to Pakistan.
“UAE authorities have confirmed to IMF for their bilateral support of US $1 billion to Pakistan,” Ishaq Dar said in a tweet today.
IMF program — 9th Review Update:
UAE authorities have confirmed to IMF for their bilateral support of US $ One billion to Pakistan.
State Bank of Pakistan is now engaged for needful documentation for taking the said deposit from UAE authorities.
AlhamdoLilah!
— Ishaq Dar (@MIshaqDar50) April 14, 2023
SBP Preparing Necessary Documents to Accept Support from UAE
Ishaq Dar went on to say that the State Bank of Pakistan (SBP) was now “engaged for necessary documentation in order to accept the said deposit from UAE authorities.”
This step will allow Pakistan to get the $1.1 billion IMF loan tranche that has been postponed for months in order to help the country’s faltering economy.
Saudi Arabia also informed the IMF last week that it will give $2 billion in funding to Pakistan.
Pakistan has less than a month’s worth of foreign exchange reserves and is awaiting a $1.1 billion bailout package from the IMF, which has been delayed since November due to fiscal policy concerns.
To free up the funds, the government has reduced subsidies, abolished an artificial exchange rate cap, increased taxes, and boosted fuel costs.
The IMF’s managing director, Kristalina Georgieva, stated the day before that the institution was also in talks with friendly countries of Pakistan to provide financial assurances so that the program could be completed.
IMF Managing Director Kristalina Georgieva has expressed hope that Pakistan can avoid a situation similar to that of Sri Lanka and Ghana.
“Pakistan won’t default. “It is best not to get there, and currently, we are not there yet,” IMF Managing Director Kristalina Georgieva said at a news briefing in Washington.
She added that the IMF and Pakistani officials were also discussing how to help Pakistan “in terms of providing financial assurances so we can complete the program.”
To read our blog on “To get $1.1 bn bail-out loan, IMF adds further requirement,” click here.
