ADB Approves $1 billion in emergency budget support to Pakistan

Staff members of the Asian Development Bank step out of the Manila-based lender's headquarters on February 17, 2009. (AFP)
Updated 06 December 2019

ADB Approves $1 billion in emergency budget support to Pakistan

  • Pakistan expected to get $3.4 billion in budget support during Fiscal Year FY 20
  • IMF bailout program is expected to catalyze at least $38 billion financing from Pakistan’s development partners

KARACHI: The Asian Development Bank (ADB) has approved $1 billion loan in immediate budget support to Pakistan to shore up the country’s public finances and help strengthen a slowing economy, the ADB announced on Friday.
The quick dispersing Special Policy-Based Loan is part of a comprehensive multi-donor economic reform program led by the International Monetary Fund (IMF) to stabilize Pakistan’s economy after a major deterioration in its fiscal and financial position in mid-2018 caused growth to slump and threatened progress in alleviating poverty.
The Asian lender, in June this year, had announced to extend a loan of $3.4 billion to Pakistan for budgetary support to help with reforms and stabilization of the economy, Adviser to the Prime Minister on Finance Dr. Abdul Hafeez Shaikh had informed in mid of June 2019.
Pakistan was expecting $2.2 billion to be released this fiscal year FY 2019-20 to build up the country’s reserve position and the external account.
ADB’s financing was approved after the government implemented a series of IMF-supported reforms and actions to improve its current account deficit, strengthen its revenue base, and protect the poor against the social impact of the economic crisis.
“ADB is committed to providing wide-ranging support to strengthen Pakistan’s economy and reduce the risk of external economic shocks,” said ADB Director General for Central and West Asia Mr. Werner Liepach, in a statement issued from Manila, Philippines. “These funds will meet the government’s emergency financing needs to prevent significant adverse social and economic impacts and lay the foundations for a return to balanced growth.”
Pakistan is facing significant economic challenges on the back of a large balance of payments gap and critically low foreign exchange reserves together with weak and unbalanced growth. While the country’s economy has a history of boom and bust economic cycles, it reached a tipping point in 2018 after foreign investment shrank sharply in an uncertain political and global economic environment and the ongoing poor performance of state-owned enterprises caused public debt to reach unsustainable levels, the statement added.
In July, the IMF approved a three-year $6 billion Extended Fund Facility (EFF) to finance the government’s economic reform program that aims to put Pakistan’s economy on the path of sustainable and inclusive growth. The EFF is expected to catalyze at least $38 billion in financing from Pakistan’s development partners.
ADB has committed to provide a total of $2.1 billion in policy-based lending during fiscal year 2019–2020 to support the reform program, according to the statement.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. In 2018, it made commitments of new loans and grants amounting to $21.6 billion.


Shehbaz and Hamza Sharif released on parole to attend Begum Shamim Akhtar’s funeral

Updated 8 min 19 sec ago

Shehbaz and Hamza Sharif released on parole to attend Begum Shamim Akhtar’s funeral

  • Mother of Nawaz and Shehbaz Sharif, Begum Akhtar’s last rites will be performed in Lahore on Saturday
  • Former prime minister Nawaz Sharif prayed for Begum Akhtar in London before her body was flown back to Pakistan

ISLAMABAD: Pakistan Muslim League-Nawaz (PML-N) President Shehbaz Sharif and his son, Hamza, were released on a five-day parole to attend Begum Shamim Akhtar’s funeral that will be held in Lahore on Saturday.
Begum Akhtar, who passed away in London last Sunday, was the mother of Pakistan’s former prime minister, Nawaz Sharif, who is currently in Britain after he got a medical bail and flew out of the country in November 2019.
The Sharif family faced corruption allegations soon after the Panama Papers were leaked in April 2016.
The country’s top court disqualified the former premier from holding public office in July 2017, and he was convicted by an accountability court the next year.
While Nawaz Sharif currently resides abroad, his brother, Shehbaz, and nephew, Hamza, have been in prison and facing corruption references against them.
The provincial administration of Punjab released them on Friday to attend Begum Akhtar’s last rites as her body was flown back to Pakistan from London.
The PML-N founding leader, Nawaz Sharif, will not return to Pakistan for the funeral, though he prayed for his mother’s departed soul in a small congregation in London.
Sharif also missed his father’s funeral in 2004 since he was denied permission to return to his country from exile in Saudi Arabia by the administration of General (r) Pervez Musharraf.