KARACHI (Reuters) - Pakistan has secured commitments from China, Saudi Arabia and the United Arab Emirates to roll over debt for a year, a boost for Karachi as it awaits final approval of a new $7 billion loan programme with the IMF, Bloomberg reported on Tuesday.
Bloomberg said Pakistan’s Finance Minister Muhammad Aurangzeb told reporters in Islamabad after a parliamentary committee meeting that the volume of rollovers would be the same as last year, adding that Pakistan has $12 billion in bilateral loans that have been extended for the past few years.
Pakistan and the International Monetary Fund reached an agreement for a 37-month loan programme in July. Pakistan has relied heavily on IMF programmes for years, at times nearing the brink of sovereign default and having to turn to countries such as the United Arab Emirates and Saudi Arabia to provide it with financing to meet external financing targets set by the IMF.
Bloomberg reported that Aurangzeb said the government expected to manage a financing gap of as much as $5 billion during the fund’s three-year programme.
The IMF in its statement following the staff level agreement with Islamabad said the new Extended Fund Facility programme was subject to approval from its executive board and obtaining "timely confirmation of necessary financing assurances from Pakistan's development and bilateral partners".
The finance ministry did not immediately respond to a Reuters' request for comment.