By Staff Reporter
ISLAMABAD: Pakistan has tapped the Asian Development Bank’s (ADB) Counter-Cyclical Facility (CFC) to get $1.5 to $2 billion additional budgetary support loan in two months to prop up its fast-depleting foreign currency reserves, the IP learnt on Saturday.
However, this facility can only be provided by the Manila-based international financial institution if Islamabad manages to strike an agreement with the IMF and bring on the suspended Extended Fund Facility (EFF).
And the government has also not yet sent any official request for the facility.
During this transition period on both political and economic fronts, this ADB facility can help Pakistan avert crisis-like situations.
“Without the revival of the IMF programme under $6 billion Extended Fund Facility (EFF), Pakistan will not be able to access the CCF facility,” a senior government official confided to IP here on Saturday.
The ADB had established the CCF on the eve of the East Asian Crisis, but it was never utilised later on by any member country of the Bank.
However, Pakistan managed to secure $1 billion when former Secretary of Finance Shahid Mehmood was representing Pakistan as Executive Director of ADB based in Manila.
“Pakistan has again explored the possibility of availing the CCF to get additional funding at a rate of little over 2.5 percent,” said the senior official.
A high-powered ADB delegation is visiting Pakistan and the government might kick-start its deliberation next week to assess the economic situation on the ground and the short- to medium-term plans of the incumbent coalition government led by the Prime Minister Shehbaz Sharif.
This whole idea came under discussion this week when the ADB delegation called on Minister of State for Finance and Revenues Dr Ayesha Ghous Pasha.
Minister of State for Finance and Revenue acknowledged that ADB had always assisted Pakistan in pursuance of reform and development agenda.
Pasha said ADB’s all-weather and trusted partnership with Pakistan especially in the areas of energy, education, and fiscal and debt management was exemplary.
Further, she shared that currently Pakistan was facing various fiscal and monetary challenges but the present government was keenly working on various structural reform measures to bring the economy back on an inclusive and sustainable growth path.
The Country Director ADB briefed the Minister of State on ADB’s portfolio and strategy.
The ADB is devoted to providing support for the reform agenda of SOEs governance and regulations, women-inclusive finance sector development and PPP frameworks, the officials of the bank said.
Moreover, ADB also indicated the additional support of $2.5 billion for the next fiscal year, from which $1.5-2 billion may become available in this calendar year.
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