LAHORE, Nov 23: Pakistan is working on a request to seek debt relief from Paris Club which is expected to meet in next 4-6 weeks.
“We’ve already contacted the individual countries constituting Paris Club, seeking relief in the (bilateral) debt from them. Now we’re awaiting their collective response at the meeting,” Finance Minister Shaukat Aziz told reporters after launch of the Internet Trading System at the Lahore Stock Exchange here on Friday.
“I cannot say how the United States is going to respond to our request. We’ll know its response at the meeting,” he told a questioner.
Pakistan is seeking immediate, maximum relief in its bilateral debt of about $12 billion from the Paris Club member countries in order to put its wrecked economy, hit hard by the Sept 11 terror attacks and the ongoing war in Afghanistan, back on the rails. Though it is not clear whether the lenders would agree to its request for debt relief or not, there are some indications of positive response in return for Pakistan’s support to the US-led international coalition against terrorism.
To a question about the government’s request seeking a low-cost Poverty Reduction and Growth Fund facility from the International Monetary Fund, he declined to give the details.
“You’ll know the details when the IMF executive board meets on Dec 5,” he said. “I cannot divulge anything right now.” It is pertinent to note here that he was rebuked by an IMF spokesman last year when he claimed that the IMF had agreed to provide $596 million low-cost facility for 10 months to Pakistan to support its balance of payments weeks before the IMF board gave its approval.
Shaukat Aziz said the government was also “negotiating debt swaps with Germany, Italy, the UK, and Norway for education, health and some other areas of social sector”.
The minister said President Gen Pervez Musharraf would preside over a high-level meeting at Islamabad on Monday to “approve several development projects outside the PSDP” in the areas of education, health, and poverty reduction.
He was hopeful that the infrastructure projects being launched by the government would help reduce poverty, and create thousands of new jobs for the unemployed.
HE SAID: “Pakistan has so far received $600 million from the US.” Japan has committed to provide Pakistan $300 million, the UK $100 million, and the European Union $50 million.
Unlike past, he claimed, the “donors had attached no condition to the funds transferred to Pakistan that was reflective of their confidence in our economic policies and programmes”.
“The donors are confident that the money given to us would not be wasted by us and would be spent to improve the social sector,” he said.