Finance Minister Asad Umar says Pakistan will consider all other options if rescue conditions are unacceptable
– Former Foreign Minister Ishaq Dar was unable to approach the IMF due to Pakistan's poor economic situation
– The US should not oppose Pakistan's demand for an IMF rescue, as it has no authority to influence the decision of the Fund
ISLAMABAD: Pakistan will share the details of the debt it has received from China with the International Fund for Surveillance (IMF), as there was nothing to hide in this regard, Finance Minister Asad Umar said on Saturday.
"Pakistan has received short and cheaper loans from China, which will be repaid in three years," said the Finance Minister in a press conference. "Although Pakistan has asked the IMF for $ 12 billion, the lender is likely to agree on less than demand, and with the IMF team starting formal talks on November 7, it's premature to talk about the lender's terms. "
Umar said the decision to contact the IMF had been taken following consultations with all friendly countries, including China and Saudi Arabia. Like the previous program, he added, the next program would also be for three years. However, he avoided taking over the expected amount from the fund.
"The government has turned to the IMF because of the wrong policies of the previous government, and in 2013 I admitted on the floor of the house that former Finance Minister Ishaq Dar had no choice but to turn to the IMF and the economic We would also be responsible for the case that the next government should go to the IMF, "said Asad Umar, criticizing the opposition parties for their recent rapprochement with the IMF a "historical" development.
"Prime Minister Imran Khan never shunned the IMF's option during the election campaign because I clearly informed him of the economic situation in which the IMF was the only solution," said the finance minister.
Regarding the US objection to the IMF program, he said that the US should not reject this step, as they have no veto power to force the fund to change its decision.
"I totally disagree with what US State Department spokeswoman Heather Nauert said about China's debt," the minister said, referring to the recent statement by Nauert, citing Chinese debt as a reason for Pakistan Call for an IMF rescue package.
In response to a request, the Finance Minister said that Chinese investment did not significantly increase the country's total external debt burden, adding that Pakistan would only pay China $ 300 million a year. The funds received from the IMF will not be spent on repayment of Chinese debt, he said.
According to the minister, total debt was $ 95 billion, and the country had to repay $ 9 billion this fiscal year.
The minister also acknowledged that the IMF had obtained details of agreements with China, saying that the lender had asked about debt sustainability in the initial talks. "I was not asked about the China-Pakistan Economic Corridor (CPEC)," the Finance Minister said.
He acknowledges that as long as the country does not eliminate the causes of rising debt, deficits will continue to plague the economy.
"If a rupee depreciates against the dollar, the debt burden will increase by Rs. 95 billion, and earlier governments will be responsible for the same," he said, adding that the only way to stabilize the rupee is to increase the country's exports for which the new government has taken various steps, such as stimulating the textile sector and removing regulatory
The minister defended the government's decision to turn to the IMF and said there was "no more option" for his government, as the current account deficit increased by $ 2 billion each month while there was not enough reserve to clear the import bill to pay for two months.
The minister pointed out that reserves were $ 18.925 billion when the previous government closed the IMF's lending program in October 2016. "But the decline in reserves continued thereafter, reaching $ 8.408 billion in September 2018. The current account deficit was $ 4.867 billion in 2015-16 reaching $ 18.130 billion in late 2017-18," he said.
Asked by a question, the Treasury Secretary said his government could review the IMF option if the lender sets conditions that Pakistan may not be able to accept.
On another issue, the minister said that Pakistan is discussing oil delays with Saudi Arabia for deferred payments.
The Minister was accompanied by Minister of State Hamad Azhar.