x Abu Dhabi, UAESaturday 22 July 2017

Pakistan asks IMF for multibillion-dollar rescue

Pakistan is in a critical condition and IMF's approval of Pakistan's financial strategy is expected to open the way for aid.

ISLAMABAD // Pakistan requires US$10 billion (Dh37bn) to US$15bn of support from foreign lenders to avert a balance of payments crisis, the country's newly appointed economic troubleshooter says. "In 24 months, we must correct the imbalance we have created," said Shaukat Tarin, an adviser to the prime minister on economic affairs. Pakistan is undergoing an annual economic review, which all International Monetary Fund (IMF) members face, but it is already in a critical condition, with the central bank holding barely enough foreign currency to cover six weeks of imports.

Islamabad was expected to seek a multibillion-dollar rescue package from the fund at a meeting in Dubai today. IMF approval of Pakistan's financial strategy is expected to open the way for aid from other assistance. Pakistan has already approached the World Bank, the Asian Development Bank and bilateral donors including Saudi Arabia and China for support. "Immediately, we don't need more than $10bn to $15bn," Mr Tarin said.

Inflation in Pakistan is running close to 25 per cent, the budget deficit is unsustainable, and the international bond market has priced in a debt default. * Reuters