ISLAMABAD: Washington wishes to see Pakistan in an “economically sustainable position,” US Department of State Spokesperson Ned Price said on Thursday in response to growing concerns about Islamabad’s declining reserves and external financing needs.
With a net total of $4.3 billion of foreign exchange reserves in its central bank, Pakistan is desperately seeking external financing from allies and multilateral organizations to contain its dwindling forex reserves.
Soaring inflation and suspended talks for a loan tranche of $1.1 billion with the International Monetary Fund (IMF) have led to speculation the country may default on its payments. The government, however, has strongly denied Pakistan will default and urged investors and economists not to pay heed to the rumors.
Reeling from last year’s cataclysmic floods that Pakistan estimates caused over $30 billion in damages, the South Asian country has sought debt relief from the international community to deal with the crisis. On Thursday, Price was asked to comment on Pakistan’s low foreign exchange reserves and whether Washington was considering providing debt relief to Pakistan.
Price said the US was aware Pakistan has been working with the IMF and other international financial institutions on its economic issues. “We want to see Pakistan in an economically sustainable position. Those conversations, as I understand it, are ongoing,” he told the media.
He said Washington was supportive of Islamabad but said debt relief talks are “ultimately these are conversations between Pakistan and international financial institutions.”
When asked whether the US was giving suggestions to Pakistan on improving its economy, Price said conversations with Pakistan often “entail technical issues,” adding that they take place between the US Department of Treasury and Pakistani officials.
“But Pakistan’s macroeconomic stability is a topic of conversation between the Department of State and our counterparts, the White House, the Treasury Department, among others,” he added.
