ISLAMABAD: Finance Minister Asad Umar on Tuesday claimed that the country’s imminent balance of payments crisis had been averted after Chinese commitment for assistance.
“Immediate balance of payments crisis is over after Chinese commitment and $6 billion bailout package from Saudi Arabia,” Mr Umar said while speaking alongside Foreign Minister Shah Mehmood Qureshi at the Foreign Office on Prime Minister Imran Khan’s just concluded maiden trip to China.
Although Pakistan and China have a strategic relationship and are staunch allies, Mr Khan’s visit had attained special significance because of expectations of Chinese financial help for balance of payments support.
The Chinese leadership had after the meetings with PM Khan pledged to help Pakistan come out of a looming economic crisis, but left the details to be worked out in subsequent meetings at the officials and experts levels.
Foreign Minister Qureshi says Pak-China ties are much more than ‘simple give and take’
Foreign Secretary Tehmina Janjua has stayed back in Beijing to lead the Pakistani delegation at the talks scheduled for Friday. State Bank Governor Tariq Bajwa, Finance Secretary Arif Khan, Commerce Secretary Younus Dhaga and Planning Secretary Zafar Hassan would join Secretary Janjua in the negotiations for the assistance package. The Chinese side would be led by Vice Foreign Minister Kong Xuanyou.
The government had earlier indicated that there was $12bn financing gap, out of which Riyadh had given a $6bn lifeline. Going by Finance Minister Umar’s announcement, it looks Chinese package too will be a big one, but the details will emerge once the negotiations are completed.
Besides negotiating the assistance for balance of payments, the delegation will discuss currency swap arrangement and increased access for Pakistani products to Chinese markets to redress Pak-China trade imbalance.
Meanwhile, an International Monetary Fund mission is also beginning on Wednesday negotiations with the government on a stabilisation package.
The Chinese assurance and Saudi commitment will ease pressure on the Pakistani team negotiating with the IMF.
Speaking on this occasion, Foreign Minister Qureshi regretted that the question asked most often after a foreign trip was “what did you get?” He said that while analysing China visit, it should be kept in mind that the Pak-China ties were much more than “simple give and take”. China, he recalled, had helped Pakistan immensely in the past.
Mr Qureshi said it was decided during the visit that the next meeting of the Joint Coordination Committee — which steers the China-Pakistan Economic Corridor — would be held by December so that a new direction for the CPEC could be formalised.
It had been agreed that the CPEC would be refocused to place greater emphasis on industrialisation, attracting investments for special economic zones, agriculture sector, jobs creation and vocational training.
Development of Gwadar and its port, the foreign minister said, was also being fast-tracked. “CPEC is being made the gateway for progress, prosperity and connectivity,” he said.
Mr Qureshi said the China visit helped strengthen the already existing strategic cooperation and at the same time increase the economic content in bilateral ties. The visit, he noted, was important for four reasons — messaging to the world that bilateral ties remain strong and robust; seeking economic assistance for stabilisation of economy; consultations on the CPEC with regards to taking it into next phase and reorienting it according to the priorities of the new government; and participation in the Shanghai China International Import Expo.
The foreign minister said that in addition to the commitment for balance of payment support, China had agreed to increase its imports from Pakistan and in this regard it had been decided that the second phase of Free Trade Agreement would be concluded at the earliest. It is expected that FTA-II will be signed by April next year.
Published in Dawn, November 7th, 2018