China's promise of support came after France and Pakistan agreed to postpone their USD 107 million loans as part of the G20 Debt Service Suspension Initiative (DSSI).
Months after rolling over a USD 4.5 billion loan that was scheduled to be repaid this year, China has raced to help Pakistan once more by offering USD 2.5 billion in assistance to support the rapidly declining foreign exchange reserves of its cash-strapped all-weather partner.
China's promise of support came after France and Pakistan agreed to postpone their USD 107 million loans as part of the G20 Debt Service Suspension Initiative (DSSI).
According to a recent announcement from Pakistan's Economic Affairs Division, the agreement was signed by French Ambassador Nicolas Galey and Ministry of Economic Affairs Secretary Mian Asad Hayaud Din.
"Strategic all-weather allies for cooperation, China and Pakistan. In response to a question about China giving Pakistan RMB 15 billion (USD 2.3 billion) to boost its dwindling foreign exchange reserves, Chinese Foreign Ministry spokesman Zhao Lijian said at a media briefing here that China always supports Pakistan is expanding its economy, improving livelihoods, and maintaining financial stability.
According to Pakistani media, Prime Minister Shehbaz Sharif expressed optimism that Pakistan would get USD 2 billion from the IMF.
China's most recent support comes on top of Beijing's deferred payment of a USD 4.5 billion debt that Islamabad was supposed to pay in March of this year and a USD 2.5 billion donations made in 2019 to enhance Pakistan's declining foreign exchange reserves.
Despite significant Chinese investments and loans, Pakistan is the second country in the sub-continent after Sri Lanka to experience a severe economic crisis. Before Sri Lanka's government declared bankruptcy and defaulted on all its USD 51 billion foreign debt, China ignored its frantic appeals.
The increased Chinese aid to Pakistan was given in response to this month's visit by Pakistani Army Chief General Qamar Javed Bajwa. The two nations decided to intensify their defence and counterterrorism cooperation at that time.
Bilawal Bhutto, the foreign minister of Pakistan, visited Beijing for the first time last month and met with Wang Yi, his Chinese counterpart. Cash-starved With increasing inflation, declining foreign exchange reserves, a widening current account deficit, and a sinking currency, Pakistan has seen escalating economic difficulties.
According to Pakistan's Finance Minister, Miftah Ismail, Chinese banks have agreed to refinance Pakistan with USD 2.3 billion in money as a major relief for the cash-strapped nation and to assist it in rebuilding its dwindling foreign exchange reserves. The delay in restarting a multibillion-dollar International Monetary Fund (IMF) program has left Pakistan's economy in a precarious state.
To aid Pakistan in reviving its faltering economy, Saudi Arabia has agreed to provide the nation with a "sizeable package" of about USD 8 billion. Saudi Arabia gave the State Bank of Pakistan USD 3 billion in deposits in December 2021, and the Saudi oil facility began operating in March 2022, giving Islamabad USD 100 million to purchase oil. According to Pakistan's Finance Minister, Miftah Ismail, Chinese banks have agreed to refinance Pakistan with USD 2.3 billion in money as a major relief for the cash-strapped nation and to assist it in rebuilding its dwindling foreign exchange reserves.
The delay in restarting a multibillion-dollar International Monetary Fund (IMF) program has left Pakistan's economy in a precarious state.
Saudi Arabia gave the State Bank of Pakistan USD 3 billion in deposits in December 2021, and the Saudi oil facility began operating in March 2022, giving Pakistan USD 100 million to purchase oil.
