China Development Bank (CBD) has approved a re-financing loan of $700 million for Pakistan.
Finance Minister Ishaq Dar confirmed the development on Twitter. He said, “Formalities completed and Board of China Development Bank has approved the facility of US $ 700 million for Pakistan. This amount is expected to be received this week by State Bank of Pakistan which will shore up its forex reserves!”
Formalities completed and Board of China Development Bank has approved the facility of US $ 700 million for Pakistan. This amount is expected to be received this week by State Bank of Pakistan which will shore up its forex reserves!
— Ishaq Dar (@MIshaqDar50) February 22, 2023
The development comes as foreign exchange reserves held by the central bank were recorded at $3.192 billion, up $276 million compared to $2.916 billion on February 3, remaining at their lowest since February 2014. With an agreement in place on re-financing a loan of $700 million from the China Development Bank (CDB) for Pakistan, the reserve count is expected to show a slight jump in next week’s forex review.
Pakistani authorities and the International Monetary Fund (IMF) continue their virtual talks for moving toward the signing of a Staff-Level Agreement (SLA). “Virtual talks are continuing and things are moving forward. I am very optimistic as things are moving forward positively”, said Minister of State for Finance and Revenue Aisha Ghaus Pasha while talking to media persons on Monday.
It is pertinent to mention that in order to get the IMF bailout, Pakistan must obtain assurances from Saudi Arabia and China regarding additional loans. The government has already taken a number of steps to meet the stringent IMF requirements. Allowing the market-determined exchange rate, imposing new taxes, and raising electricity and gas tariffs are among them.
Pakistan is now hoping that its friends will come to its aid, as it has worked hard to persuade the IMF.
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