ISLAMABAD, Jan 29: The Bush administration is likely to write off Pakistan’s one billion dollar loan by early February, prime minister’s adviser on finance Shaukat Aziz said here on Wednesday.
“The House Sub Appropriation Committee of the United States is meeting next week or the week after to write off $1 billion loan out of $3 billion loan owed by Pakistan,” he stated.
Speaking at a news conference here after his return from Davos (Switzerland), where he had gone to attend the World Economic Forum meeting, Shaukat Aziz said that United States Acting Secretary of Treasury Kenneth Dam told him during a meeting in Davos that the House appropriation committee was about to write off
one billion dollar loan to help ease Pakistan’s external debt burden.
He said he held a number of meetings with his counterparts at Davos, including the acting treasury secretary and undersecretary of state for economic affairs Alan Larson.
“I discussed with the United States authorities a number of important issues, including anti-money laundering measures and renewed United States budgetary support for Pakistan,” Mr Aziz said. He said he had also held a meeting with Congressman Kolbi who was the head of appropriation committee for foreign funding.
Shaukat Aziz said he also met senior officials of the Organization of Economic Cooperation and Development (OECD) in Paris, while returning from Davos. The next meeting of the Organization of Economic Cooperation and Development would be held in April in which Pakistan would also be invited to seek increased cooperation from the developed countries. Pakistan, he said, would attend the meeting as a non-member but on certain invitation.
Similarly, he said he met officials of the Export Credit Agency to get Pakistan’s credit rating enhanced. “The ECA basically deals with prices and determine credit rating for developing countries,” he added.
Mr Aziz said United States Exim Bank, Kofas of France, Hermes of Germany, Sache of Italy and ECDG of England were some of the important members of the ECA.
Mr Aziz said he also met First Deputy Managing Director of IMF Anne Krueger and informed her about the latest economic situation of Pakistan. “I told her that after the ongoing Poverty Reduction Growth Facility, Pakistan would not be seeking any loan from the International Monetary Fund (IMF),” he added.
Responding to a question, the adviser on finance said that since Pakistan’s foreign exchange reserves had touched $9.3 billion mark, the government had decided to repay the most expensive loans of the multilateral agencies.
In this regard, he referred to the recently-established debt coordination office in the ministry of finance and said that Dr Ashfaque Hasan Khan, who had been appointed its head, had been asked to work out details of the most expensive loans to be returned to various foreign agencies.
Asked whether petroleum prices would be increased in view of any possible attack on Iraq by the United States-led forces, the adviser said that the issue of fixing oil prices had nothing to do with the government. The oil advisory committee was responsible for reducing or increasing petroleum prices, he added.
The government has, however, finalized a contingency plan in case of war to keep the oil price under check, he added.
