SHEHBAZ SHARIF SEEKS SAUDI CASH AND OIL TO STABILIZE PAKISTAN’S ECONOMY

Thu 28 April 2022:

Pakistan’s new leader will ask Saudi Arabia for more than $7 billion in favors as the country strives to fix an economy beset by rising current and fiscal account deficits.

Shehbaz Sharif arrived in the Islamic kingdom on Thursday after being elected prime minister after his predecessor, Imran Khan, was ousted in a no-confidence vote earlier this month.

Sharif was handed a difficult task: closing a $12 billion current account deficit in the first nine months of the current fiscal year, which ends June 30.

The budget deficit has also increased to more than 5% of the country’s GDP, or approximately $17 billion, according to figures from the central bank.

Islamabad will ask Riyadh to roll over a $4 billion bilateral loan Pakistan is scheduled to pay by year’s end, by a year, an official told dpa, seeking anonymity.

Pakistan will also seek to enhance from $3 billion to $5 billion the amount Saudi Arabia had parked in the country’s central bank to help maintain depleting reserves.

Sharif will ask Saudi Crown Prince Mohammed bin Salman to double a $1.2-billion-a-year oil facility on deferred payments that was announced by the kingdom last year.

“We are hopeful these favours will help us move out of the danger of default on our international commitments,” the official said.

The Saudis had played a central role in the safe exit of Nawaz Sharif from Pakistan after Pervez Musharraf toppled his government in a coup in 1999. Following the coup, the Sharif family spent eight years in exile in Saudi Arabia before returning to Pakistan in 2007.

Earlier in his first address to the parliament as prime minister, Shehbaz had highlighted special ties with Saudi Arabia.

On the sidelines of the visit, Shehbaz would also visit Mecca to perform Umrah pilgrimage.

Last week, Shehbaz met with Saudi Ambassador to Pakistan Nawaf bin Said Al Malki and “vowed to explore new avenues of bilateral relations between the two countries”. The Saudi Ambassador reaffirmed the Gulf Kingdom’s commitment to take the “brotherly relations to new heights”.

The visit takes place as Pakistan and the International Monetary Fund (IMF) begin technical discussions to increase a bailout package from $6 billion to $8 billion.

SOURCE: INDEPENDENT PRESS AND NEWS AGENCIES

___________________________________________________________________________________________________________________________________________

FOLLOW INDEPENDENT PRESS:

TWITTER (CLICK HERE)
https://twitter.com/IpIndependent