Pakistan Finance Minister tries to calm creditor fears after PM pleads for debt relief
24 Sep 2022 12:21pm
Pakistan Finance Minister Miftah Ismail - AFP Photo
"Given the climate-induced disaster in Pakistan, we are seeking debt relief from bilateral Paris Club creditors. We are neither seeking nor do we need any relief from commercial banks or Eurobond creditors," Finance Minister Miftah Ismail said on Twitter.
"We have a US$1 billion bond due in December which we will pay on time and in full. We have been servicing all our commercial debt and will continue to do so," he said.
The minister said Pakistan's Eurobond debt is US$8 billion and due between now and 2051.
"That's not a large burden. A significant portion of our debt is from friendly countries who have said they will re-roll their deposits," Miftah said.
The State Bank of Pakistan (SBP) said on Sunday the Saudi Fund for Development (SFD) will extend its US$3 billion deposit maturing on Dec 5 for one more year.
In August, the International Monetary Fund (IMF) approved a loan agreement with Pakistan to release about US$1.1 billion in new funding.
The SBP said on Friday its total liquid foreign reserves stood at US$14 billion as of Sept 16.
There have been concerns about Pakistan's debt obligations and its dwindling foreign exchange reserves recently due to political uncertainty.
Shehbaz, who became prime minister in April ignited market panic on Friday as he made desperate pleas for international debt relief in a Bloomberg Television interview in New York.
"All hell will break loose” if urgent debt relief is not provided he said citing the catastrophic flood situation in the country.
"We have spoken to European leaders and other leaders to help us in the Paris Club to get us a moratorium," the Pakistan prime minister said.
"Time is running, and we're racing against time," he said. - Bernama
