ISLAMABAD: Amid a series of high level consultations, Finance Minister Asad Umar on Monday asked for accurate data on the size of external debt, repayments due during the current fiscal year and their schedule to ensure considered decision making at the earliest. The minister is busy in drawing up an action plan for macroeconomic stabilisation as the twin deficits on fiscal and external accounts continue to rise.
On the sidelines, the finance minister also had meetings with two of the country’s largest bilateral lenders — ambassadors of China and Saudi Arabia. The minister described the meetings as routine courtesy calls, saying they did not last more than a few minutes.
This coincided with a call on Prime Minister Imran Khan by Chief of Army Staff Qamar Javed Bajwa, who just returned from Saudi Arabia and is believed to have shared, among other issues, his engagements with Saudi authorities and the feedback received.
An official said the total debt repayments due during the current fiscal year ranged between $8-10 billion but need to be firmed up as current account deficit was also estimated to be around $21bn or so. Of that, about $12-15bn were in the pipeline, leaving a gap of about $15-17bn to be met through demand side management or external support through various options and products.
Finance Minister Asad Umar declined to go into details of the funding requirements or the contents of his engagements with the ambassadors. Talking to Dawn, he also declined to comment if financial support had been sought from Chinese and Saudi friends and its size. “I would not comment on that,” he said, adding the two ambassadors paid courtesy calls on him and he had not invited them.
He said macroeconomic crisis was serious and he was constantly working on it since assuming the office last week to reach a level where a position at the level of ministry of finance is finalised. “We will then take this up with the State Bank of Pakistan for their input and take this through to the prime minister along with various options and solutions for onward presentation to the cabinet and then to the parliament.”
He said he had gone past the stage of financing gap and was now engaged with various stakeholders to see how to reduce this gap and then finance the remaining part and which sources are preferable.
Informed sources said the Economic Affairs Division gave a presentation to the finance minister on various issues such as foreign debt and liabilities, including those under the sovereign guarantees but the minister was not fully satisfied with the overall picture. For his part, he downplayed any talk of his dissatisfaction, saying the work underway these days is largely of a technical nature.
An official statement quoted the minister as saying that assessment of foreign financing requirement was an important function and Economic Affairs Division should regularly update its assessment of various sectors in order to utilise the valuable resources in the most productive manner.
He was given detailed briefing on various aspects of economic cooperation with numerous bilateral and multilateral development partners including financial progress of different foreign-funded projects as well as certain aspects of potential projects to be included in the pipeline in future.
A separate statement said Nawaf Bin Said Al Malki, the Saudi Ambassador to Pakistan, called on the finance minister and “extended his felicitations” on assuming his new responsibilities and conveyed the best wishes and full support from King Salman bin Abdulaziz Al Saud. The ambassador said that the bilateral relations between the countries “are rooted in history and will further strengthen in future.”
Umar said his ministry will continue to support efforts for further strengthening of brotherly relations between the two countries.
Separately, Yao Jing, Ambassador of People’s Republic of China, also called on the finance minister as part of his round of engagements with key government functionaries including the prime minister and speaker of the national assembly.
The Chinese envoy congratulated the minister on his new responsibilities and said he looked forward working closely with the Ministry of Finance with a view to further increasing the economic cooperation between the two countries.
Umar thanked the ambassador and expressed his desire to further enhance bilateral cooperation in various fields. “Referring to CPEC, the minister said the corridor will play an important role in taking Pakistan’s economy forward as well as cementing the bilateral relationship.” He assured Jing of his full support for assistance in that regard.
Published in Dawn, August 28th, 2018