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.


FM Qureshi holds meeting with UAE state minister, discusses bilateral cooperation

Updated 28 November 2020

FM Qureshi holds meeting with UAE state minister, discusses bilateral cooperation

  • The Pakistani foreign minister highlighted close fraternal ties and stressed his country’s commitment to closer bilateral cooperation
  • UAE Minister of State Reem Al Hashimi appreciated Qureshi’s proposal to the OIC to focus on the menace of Islamophobia

ISLAMABAD: Pakistan’s Foreign Minister Shah Mahmood Qureshi met United Arab Emirates Minister of State Reem Al Hashimi on the sidelines of the OIC’s Council of Foreign Ministers’ meeting in Niamey, Niger, on Saturday.
During their meeting, the two leaders exchanged views on bilateral cooperation, COVID-19 situation, Pakistan’s participation in an Expo arranged by the UAE, and other matters of mutual interest.
Qureshi highlighted the close fraternal ties and people-to-people contacts between the two countries and stressed Pakistan’s commitment to forge closer cooperation with the UAE in diverse fields.
According to an official handout circulated by the foreign office of Pakistan, the Emirati state minister lauded Qureshi’s speech at the Niger meeting in which he proposed the OIC to deal with the menace of Islamophobia.
“Apprising the Emirati Minister of State of the difficulties being faced by Pakistani citizens with regard to UAE visa, Foreign Minister Qureshi underscored the need to address the issue at the earliest possible,” said the official statement. “The two sides also exchanged views on OIC matters and stressed the importance of further strengthening it as a united and pivotal platform for the Muslim Ummah.”
It was also agreed during the meeting to enhance mutual exchanges to carry forward the process of growing bilateral cooperation.