ISLAMABAD: The Pakistani foreign office said on Thursday the finance ministry was in touch with governments of Middle Eastern countries, China and other nations about financial assistance and “massive investments” expected to come in the future.
Financial support by friendly nations will offer some respite to the South Asian nation of 220 million, which is still reeling from devastating nationwide floods that have caused more than $30 billion of damages and whose foreign reserves have fallen to the level of covering barely three weeks of imports.
The Pakistani rupee has also been falling since January after foreign exchange companies removed a cap on the exchange rate, a key demand of the IMF as part of a program of economic reforms it has agreed on with the cash-strapped South Asian nation.
“As far as the financial and economic support of our friends including from the Middle East is concerned, first of all I would like to convey our deepest gratitude for the support that we have received from our friendly countries including China and our brotherly countries in the Middle East,” the foreign office spokesperson said on Thursday.
“Our Ministry of Finance remains in contact with the governments of these countries about the modes of support and financial assistance, as well as massive investments that are coming in from the UAE, Saudi Arabia, Qatar, China and other friendly countries. This is an ongoing process, and please stay tuned for statements from the concerned Ministries on the results of these discussions.”
Facing an acute balance of payments crisis, Pakistan is desperate to secure external financing. It secured a $6 billion IMF bailout in 2019, which was topped up with another $1 billion last year to help the country following floods, but the IMF then suspended disbursements in November due to Pakistan’s failure to make more progress on fiscal consolidation.
Pakistan is also reeling from multi-decade high inflation, which economists fear will now get worse.
