ISLAMABAD: Finance Minister Ishaq Dar has said that Pakistan was well-positioned to manage around $34 billion in external financing in the fiscal year 2023.
“The total (borrowing) requirement for the current fiscal year is about $32-34 billion. You will have $22 billion liabilities due to the multilateral, and roughly $12 billion deficit,” Dar told journalists. “We can, God willing, manage that.”
“I assure you that you don’t need to worry. We will get that,” Dar added.
Restructuring debt from the Paris Club and delaying the payment of matured bonds would be cliched steps, the finance minister said.
“Pakistan’s $1 billion worth of Eurobond will mature in December as scheduled and be paid on time,” Dar said.
“There is no need to be nervous, Pakistan will not default,” he said.
Last week Dar attended the annual meetings of the International Monetary Fund (IMF) and World Bank in Washington, where he also met credit rating agencies and US administration officials.
Moody’s slashed Pakistan’s sovereign credit rating on October 6 by one notch to Caa1 from B3, which it said was because of increased government liquidity and external vulnerability risks following the floods, in a move strongly contested by the Pakistani government.
Saying that “poverty neither comes nor does it go in just six months”, Dar boasted the coalition government had succeeded in saving the country from defaulting on its international obligations.
The finance minister said Pakistan would need inflows of $32-$34 billion in the next year. “It is only possible if we work together.”
When asked about his “freedom” to take economic decisions, Dar said had he not been free to do that, he would never have taken up this challenge.
He said it was the State Bank of Pakistan’s responsibility to control the rate of the dollar, which it was dispensing efficiently, adding, the good news was likely around the corner.
“Dollar’s real level was under 200 rupees.”
The government would also approach China for the rescheduling of loans, Dar said. “We are confident we will be able to win this relief.”
Pakistan’s economy, already in turmoil, has been badly hit by devastating floods this monsoon season which is estimated to have caused over $30 billion in losses.
