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Mettis Global News
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Pakistan wants more Loans – Warns China on full disclosure to IMF regarding CPEC

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According to a report in Financial Times, Pakistan has asked China for more loans as the country’s foreign reserves continue falling.

It has also warned China that if it was forced to resort to the IMF for a bailout, it may have to comply with requests for full disclosure on China-Pakistan Economic Corridor related schemes and how each of those are being funded.

It also mentioned that it might be asked by IMF to cancel some of the planned infrastructure projects under the CPEC plan.

Pakistan’s foreign reserves have been declining for the last two years in light of increased imports, due in part from an increase in oil prices in the global market, as well as declining remittances from abroad that have had a combined pressure on our external accounts position.

In the fiscal year 2018, loans from China exceeded $5 billion, after the country recently lent $1 billion in the month of June 2018. Prior to that, in the first ten months of the fiscal year, China had lent $1.5 billion in bilateral loans besides the $2.9 billion in loans the country had received from Commercial banks, most of which were Chinese.

It is being increasingly expected that unless China shores up our reserves with further loans, the country would have to resort to IMF for a bailout package after the new government comes to power. The last time Pakistan had reached out to IMF was in the year 2013, receiving a package worth $6.7 billion, disbursements of which lasted until the year 2016.

Posted on: 2018-07-06T11:54:00+05:00

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