UAE Provides Debt Relief to Pakistan to Avert Imminent Default
© AFP 2023 AAMIR QURESHI
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Pakistan’s Prime Minister Shehbaz Sharif met UAE’s President Sheikh Mohammed bin Zayed al-Nahyan in Abu Dhabi on Thursday during an official visit to the Gulf nation.
The United Arab Emirates has agreed to roll over an existing loan of $2 billion to Pakistan that was due for repayment in the upcoming weeks, Pakistan’s Information Minister Marriyum Aurangzeb announed on Thursday.
Abu Dhabi also agreed to provide a loan of $1 billion to bolster Pakistan’s forex reserves, which fell to an eight year-low in the last week of December.
The announcement came following a meeting between Pakistan’s Prime Minister Shehbaz Sharif and UAE’s President Sheikh Mohammed bin Zayed al-Nahyan earlier in the day.
Abu Dhabi also agreed to provide a loan of $1 billion to bolster Pakistan’s forex reserves, which fell to an eight year-low in the last week of December.
The announcement came following a meeting between Pakistan’s Prime Minister Shehbaz Sharif and UAE’s President Sheikh Mohammed bin Zayed al-Nahyan earlier in the day.
“Advancing economic, trade and investment ties between the two brotherly countries and creating increased opportunities for the Pakistani workforce in the UAE” were the focus of the visit for Sharif, the country's foreign ministry said.
The State Bank of Pakistan (SBP) has said that the current reserves of $5.57 billion were only enough to pay for three weeks of imports.
A $1.1 billion tranche of a bailout package from the International Monetary Fund (IMF) is yet to be disbursed to Islamabad as it is yet to reportedly fulfil some of the western lender’s terms.
Last year, nationwide floods affected over 33 million Pakistanis and caused major infrastructural and agricultural damages, thus, worsening the economic crisis in the country.
Pakistan has sought over $16 billion in foreign aid for the post-flood economic reconstruction. The government managed to raise around $9 billion in loans and grants at the International Conference on Climate Resilient Pakistan’ — co-hosted by Islamabad and the United Nations—in Geneva this week.
Last year, nationwide floods affected over 33 million Pakistanis and caused major infrastructural and agricultural damages, thus, worsening the economic crisis in the country.
Pakistan has sought over $16 billion in foreign aid for the post-flood economic reconstruction. The government managed to raise around $9 billion in loans and grants at the International Conference on Climate Resilient Pakistan’ — co-hosted by Islamabad and the United Nations—in Geneva this week.
Saudi Arabia Provides Loan Relief
Earlier this week, the Saudi Press Agency (SPA) said that Crown Prince Mohammed bin Salman bin Abdulaziz Al Saud is also considering bolstering Riyadh’s federal reserves in the State Bank of Pakistan.
Riyadh would also consider increasing its investments in Pakistan to a $10 billion mark.
Riyadh would also consider increasing its investments in Pakistan to a $10 billion mark.
In December, Riyadh rolled over a loan of $3 billion to Pakistan to shore up its forex reserves.
