Hafeez favours debt rescheduling at G-20 forum, sees negative 1.5 pc growth in FY20

F.P. Report

ISLAMABAD: Amid growth projections of negative 1 to 1.5 percent for Pakistan, Adviser to the Prime Minister on Finance and Revenue, Dr. Abdul Hafeez Shaikh said Monday that poorer countries genuinely need to be favoured through debt rescheduling at the G-20 forum to provide them relief to deal with Covid-19 (Coronavirus) challenges.

“Pakistan’s firm stance in favor of debt rescheduling drive at the G-20 forum was based on the belief that the poorer countries genuinely require this assistance, though Pakistan specifically had benefited lesser from the said relief,” the advisor said.

He was talking to Ambassador of Germany, Bernhard Stephan Schlagheck, French Ambassador Dr. Marc Barety and Economic Counselor, Anais Boitiere, who called on the Adviser here at the Finance Division.

The Ambassadors then discussed with the Adviser the details of the debt rescheduling offered by G-20 countries and the need for any further loans.
Hafeez Shaikh also shared that $1.8 bn worth of loans due on Pakistan have been rescheduled including those from China, KSA and UAE counties.

He also shared that $1.8 bn due in debt servicing to G-20 countries till December 2020 are under process of rescheduling. Pakistan is not going for any commercial loan rescheduling until now, said the Adviser.

He said that Pakistan was not going for any commercial loan rescheduling until now, adding that the Finance Division would adhere to the requirements of Debt Limitation Act before planning to take up additional burden as most of the loans would be for the purpose of clearing old debt stocks.

He appreciated the support offered by the friendly countries, expressing the hope that the cooperation would continue in future for the benefit of the people of the three countries.

He said that the GDP growth rate was expected remain between negative 1 to 1.5 percent during the current fiscal year.

The Advisor shared with them the overall picture of the country’s economy amid the Coronavirus pandemic and its future impact on the overall progress of the economy.

The advisor said that before the pandemic, Pakistan was successfully able to control its current account deficit and was expecting a growth of 3% during the ongoing financial year after observing strict financial discipline.

However, after the outbreak the growth projections have become difficult to realize, he added.

Shaikh also informed the ambassadors about the details of the relief package offered to the vulnerable by the Prime Minister through Ehsaas Program and the steps which the government was taking to support the SME sector.