International Islamic Trade Finance Corporation (ITFC) Approves $3 Billion Loan for Pakistan
In a bid to strengthen Pakistan’s economic stability, the International Islamic Trade Finance Corporation (ITFC) announced a $3 billion loan for Pakistan, according to an official statement released on Thursday. The announcement followed a meeting between Pakistan’s Finance Minister, Muhammad Aurangzeb, and an ITFC delegation in Washington, where both parties discussed the financial package.
The ITFC loan will be disbursed over the next three years, providing essential support to Pakistan’s economy. During the meeting, ITFC’s CEO, Engineer Hani Salem Sonbol, was also present. Finance Minister Aurangzeb expressed his appreciation for the commodity financing agreement, which he sees as vital to Pakistan’s financial strategy.
Initial Phase and Further Financial Support
In the loan’s initial phase, Pakistan is set to receive $270 million. The finance minister affirmed the government’s full support for the initiative, ensuring smooth and effective implementation. The financial boost aligns with Pakistan’s broader goals of economic recovery and resilience.
Finance Minister’s Call for IMF Social Protection Measures
Additionally, Finance Minister Muhammad Aurangzeb emphasized the need for the International Monetary Fund (IMF) to include social protection measures in its lending frameworks, particularly for vulnerable economies like Pakistan. His remarks came during a meeting with the IMF’s Managing Director and other financial leaders from the Middle East, North Africa, Afghanistan, and Pakistan (MENAP) region.
The minister highlighted the importance of incorporating emerging challenges, including climate-related risks and complex debt restructuring. He advocated for enhanced climate resilience financing and extended debt relief for low-income countries. The finance minister welcomed the updates to the Low-Income Countries Debt Sustainability Framework (LIC-DSF), which now incorporates considerations for climate risks, domestic debt, and restructuring complexities.
Positive Economic Outlook for Pakistan
While in Washington, the finance minister also attended a roundtable organized by Jefferies International, where he presented Pakistan’s recent economic achievements. He shared positive indicators linked to the Stand-By Arrangement (SBA) with the IMF, which he believes will continue driving economic growth and investor confidence.
This $3 billion loan from the ITFC is anticipated to play a crucial role in Pakistan’s economic framework, supporting its financial recovery, boosting trade, and paving the way for sustainable growth.
