AsiaNet-Pakistan Premier Editorial Content and Press Release Distribution Service
As per research, Pakistan’s 8.25 percent bond due in April of next year fell 1.4 cents to 51.62 cents on the dollar, falling for the third day in a row. Moody’s Investors Service outlined in a statement earlier this week that the country’s external financing needs for the fiscal year ending June are estimated to be around $11 billion, including $7 billion in external debt payments.
It is worth mentioning that Moody’s downgraded Pakistan further into junk status on Tuesday as the country faces its worst economic crisis in decades, with foreign reserves plummeting and inflation reaching a record high. The credit rating agency’s analysts said that disbursements may not be secured in time to avoid a default in the current extremely fragile balance of payments situation.
In a similar response, London-based emerging-market analyst Edwin Gutierrez said, “There is definitely a higher risk for a default as negotiations with the Fund keep getting drawn out longer than expected while reserves continue to dwindle to precarious levels”.
Meanwhile, Spokeswoman Mao Ning of the Chinese Foreign Ministry said during a regular briefing today, “The Western-led commercial creditors and multilateral financial institutions are the basic creditors for developing countries, so China calls for a concerted effort of all parties to play a constructive role on the economic and social developments of Pakistan”.
The Chinese foreign ministry has urged all creditors to play a constructive role to help Pakistan.
Dar Lambasts Default Gossip
Contrary to informed reports, Finance Minister Ishaq Dar has ruled out the possibility of any default and reiterated his stance that all indicators were moving in the right direction.
In a tweet, the finance minister shared his side of the estimated default probability in Pakistan and lambasted anti-Pakistan elements for spreading malicious rumors that the country may default. “This is not only completely false but also belie[s] the facts,” he said.
The minister also provided an update on Pakistan’s negotiations with the International Monetary Fund (IMF). He said, “Our negotiations with IMF are about to conclude and we expect to sign Staff Level Agreement with IMF by next week. All economic indicators are slowly moving in the right direction”.
Source: Pro Pakistani