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Home » Islamabad

IMF focuses on rapid financing instrument to help Pakistan combat COVID-19

May 22, 2020

Washington:The International Monitory Fund said on Friday that Pakistan, on the status of their extended fund facility, which was in place before the crisis hit, remains in effect.

“Discussions were paused due to the outbreak of the pandemic, and there was a focus on the rapid financing instrument to help Pakistan combat COVID-19, and, again, that has been approved; $1.4 billion, our Executive Board has approved for Pakistan,” said Gerry Rice of the IMF’s Communication Department in a press briefing.

Rice said technical discussions continued with the authorities on the Extended Fund Facility (EFF) that’s the other instrument through which we’re supporting Pakistan. This would be the second review. We hope to bring it to a positive conclusion as soon as possible.

Rice said: “What else can I say, on the G20 Initiative and developing countries, including Pakistan? Again, you know, going back to what I said earlier, on this Debt Relief Initiative, you know, it’s important to recognize that developing countries include some very poor and indebted nations, but they also include many countries that have been developing successfully. So, it’s a broad spectrum, and I know many of you know that, but it’s important to keep that in mind. So, for many of these countries, you know, that have been developing successfully, for many of them, attaining creditworthiness, the ability and the willingness to repay their debts, constitutes a hard-fought success.”

The IMF official said: “So, that’s why I said earlier that a few developing countries have said, publicly, that they’re not inclined to take up the G20 Debt Suspension Initiative, you know, partly, because of that reason. What they want is a level playing field, in the form of stable access to finance on affordable terms, and, so, for this reason, the Fund’s priority is to ensure that these countries continue to have that access to appropriate external financing, as they go forward, and we try to contribute to that through our own lending and through initiatives, such as the G20 Debt Service Suspension, but let me be clear. As I said earlier, we also support all developing countries whose debts are unsustainable.”

“We support those countries in fighting for debt relief. Importantly, debt relief to countries whose debts are unsustainable should encompass not only official bilateral debt but also debt to the private sector.”

Rice said they will support their member countries, even whose debts are unsustainable in fighting for appropriate debt relief, and, again, whilst a few countries had indicated that they would not be participating in the initiative, the vast majority have either expressed a formal request to participate, or expressed interest, and we expect many more official requests in the coming days.

“We will support our member countries, even whose debts are unsustainable in fighting for appropriate debt relief, and, again, whilst a few countries have indicated that they would not be participating in the initiative, the vast majority have either expressed a formal request to participate, or expressed interest, and we expect many more official requests in the coming days,” Rice concluded.

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