Pak ready to share details of CPEC debts with IMF for bailout package
October 14, 2018 20:44
Pakistan is ready to share details of the debt related to the China-Pakistan Economic Corridor with the International Monetary Fund, Finance Minister Asad Umar has said while rejecting the US' view that China-funded projects were to blame for the cash-strapped country's current economic woes.
Speaking to the media in Islamabad on his return from Indonesia where he requested IMF's Managing Director Christine Lagarde for a bailout package for Pakistan, Umar said the decision to approach the global lender was taken after consultations with friendly countries.
The IMF team, Umar said, was scheduled to arrive in Pakistan on November 7 to negotiate the programme, likely to span over a three-year period. He said Pakistan's current year debt repayments were about USD 9 billion but obviously it would not entirely be available from the IMF.
Lagarde has made it clear that the IMF would require absolute transparency on Pakistan's debts, including those owned by China under the USD 50 billion CPEC.
Umar, however, rejected the US State Department's statement, suggesting that the debt accrued on the CPEC projects was to blame for Pakistan's current economic crisis.
The CPEC is a network of infrastructure projects that are currently under construction throughout Pakistan that will connect China's Xinjiang province with Gwadar port in Pakistan's Balochistan province. It is the part of Chinese President Xi Jinping's ambitious Belt and Road initiative.
The US Friday said that the huge Chinese debt was responsible for the economic challenges in Pakistan, adding that it will review Islamabad's bailout plea to the IMF from all angles, including the country's debt position.
"We understand that Pakistan has formally requested assistance from the IMF. In all cases, we examine that closely from all angles of it, including Pakistan's debt position, in evaluating any type of loan programme," State Department spokesperson Heather Nauert had said, adding this is something the US has been tracking fairly closely.
Responding to a question, Nauert said; "The secretary (of state Mike Pompeo) had spoken about this a few months back, I know, in some interviews not that long ago. I think part of the reason that Pakistan found itself in this situation is Chinese debt, and the fact that there is debt that governments have incurred that they maybe thought wouldn't be so tough to bail themselves out of, but has become increasingly tough."
Umar said the US was a key stakeholder in the IMF with about 16.5 per cent votes but enjoyed no veto power in its decision making that required majority 51 per cent votes.
He said no government in Pakistan irrespective of any political background could compromise on national security and the Pakistan Tehreek-e-Insaf government, too, would not opt for an IMF programme if conditionalities are of that nature.
But Umar Saturday said the government will have to take difficult decisions that would be painful for people but necessary under international commitments to get out of the current severe economic situation.
The IMF, Umar said, had asked for details of loans, including ones secured in relation to the CPEC projects, for analysing the debt sustainability.
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