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Source: Nanfang Daily Online Edition     time: 2022-07-07 17:11:33

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  Pakistan signs deal with France to suspend loans worth 0 million

Pakistan is facing an uncertain economic situation due to a
Image Source : PTI/REPRESENTATIVE

Pakistan is facing an uncertain economic situation due to a delay in the revival of a stalled multibillion-dollar International Monetary Fund (IMF) programme.

 

Highlights

  • France signed an agreement with cash-strapped Pakistan to suspend its loan worth USD 107 million
  • The agreement was signed by Mian Asad Hayaud Din and French Ambassador Nicolas Galey
  • Total amount of debt that has been suspended and rescheduled under DSSI framework, stands at ,688M

Pakistan: France signed an agreement with cash-strapped Pakistan to suspend its loan worth USD 107 million under the G20 Debt Service Suspension Initiative (DSSI), it was announced on Monday.

The agreement was signed by Ministry of Economic Affairs Secretary Mian Asad Hayaud Din and French Ambassador Nicolas Galey, the Economic Affairs Division of Pakistan said in a statement.

The amount was initially repayable between July and December 2021 but after the agreement, it would be repaid over a period of six years — including a one-year grace period — in semi-annual installments.

"The government of Pakistan has already signed agreements with the French Republic for suspension of USD 261m. Due to the support extended by the development partners of Pakistan, the G20 DSSI has provided the fiscal space which was necessary to deal with the urgent health and economic needs of the Islamic Republic of Pakistan," the statement added.

The total amount of debt that has been suspended and rescheduled under the DSSI framework, covering the period from May 2020 to December 2021, stands at USD 3,688 million.

"Pakistan has already concluded and signed 93 agreements with 21 bilateral creditors for the rescheduling of its debts under the G20 DSSI framework, amounting to rescheduling of almost USD 3,150m. The signing of [the] above-mentioned agreements brings this total to USD 3,257m," the statement said.

It also said that negotiations were ongoing for the remaining agreements to be signed under the DSSI framework.

Earlier this month, Pakistan signed two debt service suspension agreements with Japan and Switzerland for the suspension of USD 197.5 million in loans. A similar agreement was signed in March with the Saudi Fund for Development for the suspension of debt servicing of USD 846 million.

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Cash-starved Pakistan has faced growing economic challenges, with high inflation, sliding forex reserves, a widening current account deficit and a depreciating currency.

Chinese banks have agreed to refinance Pakistan with USD 2.3 billion worth of funds in a massive relief for the cash-starved country to help it bolster its depleting foreign exchange reserves, the finance minister Miftah Ismail said early this month.

Pakistan is facing an uncertain economic situation due to a delay in the revival of a stalled multibillion-dollar International Monetary Fund (IMF) programme.

Saudi Arabia has agreed to provide Pakistan with a "sizeable package" of around USD 8 billion to help the country revive its ailing economy. Saudi Arabia provided USD 3 billion deposits to the State Bank of Pakistan in December 2021 while the Saudi oil facility was operationalised from March 2022, providing Islamabad with USD 100 million to procure oil.

Saudi Arabia provided USD 3 billion deposits to the State Bank of Pakistan in December 2021 while the Saudi oil facility was operationalised from March 2022, providing Pakistan with USD 100 million to procure oil.

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