The United States administration has expressed its backing for Pakistan’s endeavors to break free from the daunting cycle of debt and international financing. As Pakistan gears up to seek a new International Monetary Fund (IMF) loan program in the coming months, the US State Department has pledged its support.
US State Department spokesperson Matthew Miller, speaking at a weekly press briefing on Wednesday, emphasized the significance of Pakistan’s long-term economic health for stability. He responded to inquiries regarding a letter from former Prime Minister Imran Khan to the IMF, urging the lender to consider political stability in future bailout discussions.
Khan’s letter, requesting an audit of thirty percent of the country’s general election seats, aimed to ensure the government’s popularity in implementing crucial reforms, particularly in taxation. The US administration, through Miller, stressed the need for the new Pakistani government to prioritize economic reforms, crucial for maintaining stability.
“We urge Pakistan to continue working with the IMF and other international financial institutions towards macroeconomic reforms,” Miller stated, highlighting the pivotal role of upcoming policies for Pakistan’s economic stability.
Pakistan’s economy, grappling with financial crisis, previously secured a $3 billion standby arrangement from the IMF last summer. Fitch, the ratings agency, recently emphasized the urgency for Pakistan to secure financing from multilateral and bilateral partners, given its vulnerable external position.
In a significant development, caretaker Finance Minister Shamshad Akhtar confirmed to Reuters that China has extended a $2 billion loan to Pakistan, originally due in March, providing a temporary respite.
Looking ahead, Pakistan is reportedly planning to request a new IMF loan of at least $6 billion to aid in repaying looming debts this year, as shared by a Pakistani official with Bloomberg News last week.
In a separate inquiry during the press briefing, Miller deferred questions regarding Pakistani authorities seeking consular access to four foreign nationals charged in the US for transporting suspected Iranian-made weapons. He clarified that matters of consular access for individuals in federal custody fall under the purview of the Department of Justice.
As Pakistan navigates its economic challenges, international support and financial arrangements are poised to play a critical role in shaping the country’s economic future.
