The head of the International Monetary Fund (IMF) has said that a team of the fund would visit Pakistan in the coming weeks after the country requested emergency bailout loans.
IMF Managing Director Christine Lagarde confirmed that Pakistan had requested the loans after meeting with Finance Minister Asad Umar in Indonesia on Thursday.
“Today, I met with Pakistan’s Minister of Finance, Revenue and Economic Affairs, Asad Umar, Governor of the State Bank of Pakistan Tariq Bajwa, and members of their economic team. During the meeting, they requested financial assistance from the IMF to help address Pakistan’s economic challenges,” IMF Chief said in a statement.
Analysts believe that Pakistan is seeking $8 billion in loans to wriggle out of balance of payments crisis. The government is also seeking fresh loans from China, which has already heavily invested in transport and energy.
Pakistan’s currency plunged by around 7 percent earlier this week after word of the loan request was made public.
Prime Minister Imran Khan on Wednesday vowed to steer the country out of a looming balance-of-payments crisis, saying it needs $10-12 billion.
“We will get out of this. I will take (the country) out of this,” he said.
Khan’s new administration took office in August vowing to weigh up whether to seek an IMF bailout as it sought other avenues of financing.
He has sought loans from friendly countries, promised to recover funds stolen by corrupt officials, and embarked on a series of populist austerity measures.
But help has been in short supply and economists’ warnings have grown increasingly urgent.
Pakistan has gone to the IMF several times since the late 1980s. The most recent was in 2013, when Islamabad got a $6.6 billion loan to tackle a similar crisis.