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seeks to reschedule its entire $12.5 billion bilateral debt
ISLAMABAD, October 29 (Internews):
Pakistan is pushing to convince
bilateral creditors to bless Islamabad with rescheduling of its entire
debt to cope with the economic and financial fallout of the Western
military strikes in neighbouring Afghanistan.
"We are trying to convince bilateral creditor countries to provide us
breathing space in a way that it is possible to reschedule the $12.5
billion that Pakistan owes them," an official of the Ministry of Finance
Finance Minister Shaukat Aziz during his recent visit of Paris discussed
issues related to debt rescheduling with the Paris Club president and
termed the talks "positive and constructive in achieving desired
The Paris Club has assured Islamabad of granting $5 billion worth of
rescheduling for the next three years.
"We are trying to get rescheduling of Pakistan's entire bilateral debt
portfolio and things are in the pipeline in this connection," the
finance ministry official said.
Pakistan needs $21 billion in shape of multilateral loans and debt
rescheduling to find out an amicable solution to get out of its existing
The International Monetary Fund's Board of Directors is going to review
the Poverty Reduction Growth Facility (PRGF) for Pakistan by December 5
and the Paris Club will table the issue of debt rescheduling by December
15, and both actions will provide Islamabad fiscal space to fill the
yawning gap of the next three years.
The PRGF programme is aimed at ensuring a consistent framework for
macroeconomic, structural and social policies to foster growth and
"Pakistan wants to get the most lenient conditions for debt rescheduling
and is also trying to reschedule the whole amount with a single stroke,"
the finance ministry official said.
Pakistan is satisfied with the support from the US and other western
countries in exchange for providing all-out support to the international
coalition in the fight against global terrorism.
Pakistan does not fulfil all the conditions of Highly Indebted Poor
Countries (HIPC) so it cannot enjoy facilities being provided under this
"There are other options through which the multilateral lenders can
provide us fiscal space to Islamabad in dealing with the prevailing
economic crunch," the official said.
"We are trying to complete negotiations with our multilateral lenders
and bilateral creditors as soon as possible but if the IMF provides us a
credit line under the PRGF by November, this whole process will be
accomplished before 2001 is out," he added. -Internews
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