Pakistan FM says IMF team to visit country next month to negotiate new bailout package

Islamabad: By Sajjad Hussain Islamabad, Apr 21 (PTI) Pakistan’s Finance Minister Muhammad Aurangzeb has said that an IMF team is expected to visit Islamabad next month to negotiate a new long-term bailout package to secure a staff-level agreement for the cash-strapped country by mid-July.

Speaking to the media after his week-long visit to Washington, the minister said the contours of the new International Monetary Fund programme will shape up later.

Cash-strapped Pakistan has made a formal request to the IMF to seek the next bailout package in the range of USD 6 to USD 8 billion with the possibility of augmentation through climate financing.

Addressing journalists at the Pakistan Embassy in Washington, Aurangzeb expressed the hope that the global lender’s board of governors would convene to consider the last tranche of the current programme by the end of this month, with the final instalment released shortly thereafter.

In earlier statements, Aurangzeb had said Pakistan would prefer a long-term, preferably a three-year programme.

However, when asked at Saturday’s briefing, Aurangzeb said he would not speculate on the size or the duration of the programme yet.

Earlier, Aurangzeb said that Pakistan can repay its debt to Beijing only after completing the second phase of the multi-million dollar China-Pakistan Economic Corridor (CPEC).

The minister’s candid remarks followed discussions with key financial institutions like the IMF and World Bank, alongside senior US officials in Washington this week.

Explaining his stance on this sensitive issue, Aurangzeb said: “The CPEC was a champion project for Pakistan and a lot of infrastructure was created during its first phase.

Now, what’s supposed to happen was for us to go into CPEC Phase 2, which was and remains the way we monetise that infrastructure because that’s where the special economic zones come in.

The minister elaborated that through these special economic zones, Pakistan would attract further Chinese investment.

Emphasising the necessity of completing this process, the minister said: “There’s a lot of discussion about how you are going to repay the debt, that’s how it was supposed to happen.”

He expressed gratitude to the Chinese government and banks for their assistance in debt servicing and noted: But ultimately, these debts have to be paid.

And that’s only going to be there when we get phase 2 going in real earnestness.