Pakistan secures further US$2b in funding from China to ‘avoid economic crisis’
- The latest injection is on top of Beijing reportedly pledging US$2 billion in July last year to help Pakistan weather its turbulent economy
- In the past year the rupee has lost more than a fifth of its value against the US dollar
China has pledged to lend an additional US$2 billion to Pakistan to increase the foreign exchange reserves of its South Asian ally, according to a government official in Islamabad.
On Wednesday, an official who is not authorised to speak publicly on the matter said: “As Pakistan’s financial position is weak and to further avoid economic crisis, the government is preparing to take appropriate measures to fix the economy through financial help from China.”
Pakistan is trying to overcome its looming currency crisis – in the past year the rupee has lost more than a fifth of its value against the US dollar.
The latest financial assistance was not announced by Islamabad or Beijing. Pakistan finance minister Asad Umar did not respond to a request for comment.
Zhao Lijian, the Deputy Chief of Mission at the Chinese Embassy in Islamabad, said: “We don’t have the actual amount of loans and CPEC [China–Pakistan Economic Corridor] investment given to Pakistan but China will continue to provide grants for economic development.”
The latest US$2 billion injection follows Beijing reportedly pledging US$2 billion in July last year to help Pakistan weather the economic crisis. There was no confirmation of the earlier amount, which was reported by the country’s Express Tribune newspaper, citing unnamed finance ministry officials.