ISLAMABAD: Finance Minister Asad Umar on Tuesday declared that Pakistan’s immediate balance of payment crisis of $12 billion was over.
Speaking at a joint news conference along with Foreign Minister Shah Mehmood Qureshi about Prime Minister Imran Khan’s visit to China, the finance minister also announced that China has agreed, in principle, to extend an economic relief package to Pakistan.
The modalities of this package, according to him, will be discussed on Nov 9 at a meeting in Beijing which will be attended by secretaries of finance and foreign affairs while governor State Bank of Pakistan (SBP) will also be part of Pakistan’s delegation during talks.
Responding to a question about the Chinese economic package, the finance minister said: “A decision in this regard has been taken in principle and the curiosity [about the total economic package] will end after Nov 9 meeting,” he stated with confidence. “But one thing I want to state categorically, at present the country is not facing immediate balance of payment crisis after the Saudi’s $6 billion package as well as the Chinese commitment,” he added.
Replying to a question posed by Business Recorder about the placement of the Saudi’s $3 billion for balance of payment support after the briefing, the minister said: “The $3 billion deposit is expected to take place today (Tuesday) or tomorrow (Wednesday).”
To another question about the deferred payment facility from Saudi Arabia, he said that it will take some time to materialise the facility, adding that there is an MoU which will be signed between the two countries in this regard.
Umar further told media that as a long-term policy to deal with the issue of balance of payment on permanent basis, Pakistani exports will be doubled to China and the process will start during the current year which will provide a base for putting Pakistan’s economy on the right track.
“We will have to focus on enhancing our exports and support the industries and the agriculture sector in order to permanently address the balance of payment crisis,” he said.
To ease pressure on the dollar, he said that Pakistan and China are making efforts to trade in local currencies as far as the bilateral trade is concerned, while SBP is also encouraging the business community to prefer the local currencies in trade between the two countries.
On the occasion, Foreign Minister Shah Mehmood Qureshi said the depth of Pakistan-China relations should not be seen only in the context of financial package, adding that China has always helped Pakistan in difficult times and most recently it extended help in the month of July.
He said that Prime Minister Imran Khan’s visit to China has helped convert bilateral strategic relations into a strong economic partnership, adding that the Pakistani delegation effectively highlighted economic dimensions of the relationship during the visit.
He spelled out four main objectives of the visit, saying that progress has been made in all of them through signing of 15 agreements/MoUs and discussions with the Chinese leadership.
He said the two sides agreed to upgrade Strategic Dialogue to foreign minister level and also to enhance the scope of the dialogue.
He said that it was also agreed that prisoners of the two countries will serve their remaining sentences in their respective countries.
He said MoUs have been signed to learn from China’s experience in poverty alleviation and also for transfer of technology to Pakistan to increase productivity in agriculture. He said that said discussions were held to increase exports to China so that the country’s economy could be stabilised.
He said negotiations on second phase of Free Trade Agreement (FTA) will hopefully be completed in April next year, and the agreement will be signed on the occasion of Belt and Road Forum in mid-April.
The foreign minister said the two sides also discussed ways to improve foreign exchange reserves of Pakistan. He said the technical level talks between the two sides in this regard will be held on November 9 in Beijing, and the foreign secretary will represent Pakistan in it.
He said it was also discussed that local currencies should be given priority in trade to reduce pressure on dollar.
The foreign minister also rejected the impression that there was any concern among the Chinese leadership about the new government’s commitment towards CPEC, saying that there were open discussions on the priorities in the next phase of CPEC to achieve progress, prosperity and connectivity.
He said industrialisation, establishment and activation of special economic zones, transfer of technology for increase in agriculture productivity, job creation, housing, tourism, livelihood, and skill development of local workforce will be focused during the next phase. He said ways were also discussed to accelerate pace of development of Gwadar Port.
He said that Prime Minister Imran Khan held meetings with the Chinese President, Prime Minister, Chairman National People’s Congress and Vice President and discussed the entire gamut of bilateral relations and regional and international issues, including possibility of talks with India, situation in Afghanistan, and counterterrorism cooperation.
About meeting with his Chinese counterpart, Qureshi said that besides discussions on bilateral issues, it was also agreed that a trilateral meeting among Pakistan, China and Afghanistan will be held in Kabul in December to discuss the Afghan issue.
To a question about his meeting with Ambassador of the European Union earlier in the day, he said that the meeting had nothing to do with Aasia Bibi case, adding that it was taken place to discuss the upcoming visit of the EU top representative to Pakistan for discussions on bilateral issues and Pakistan-EU strategic dialogue.