China Rolls Over $2 Billion SAFE Deposits to Pakistan

China has granted a one-year rollover of $2 billion in SAFE (State Administration of Foreign Exchange) deposits to Pakistan, which was going to mature by end of the ongoing month.

Finance Minister Ishaq Dar confirmed the development in a brief response to the media on Thursday.

It was one of the International Monetary Fund (IMF) requirements for meeting external financing needs and progressing toward the long-awaited staff-level agreement.

Pertinently, the lender’s Memorandum of Economic and Financial Policies (MEFP) contains nine tables that must be completed. One of the tables refers to Net International Reserves (NIR) as an indicative target that cannot be met without considering the program’s external financing needs through the end of June 2023.

External financing is one of the final steps the lender wants Pakistan to take before clearing funding that has been stalled since late last year.