Mohamed, Shahbaz discuss UAE-PAK ties in diverse fields
Pakistani PM thanks Mohamed Bin Zayed for the warm reception and congratulations on assuming the office of PM, commending the UAE’S great support for his country
His Highness Sheikh Mohamed Bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, and Pakistani Prime Minister Shahbaz Sharif discussed advancing the longstanding relations between the two nations, and the prospects of propelling cooperation on various fronts as well as reviewed a number of regional and international issues of common concern.
This came as Sheikh Mohamed met at Qasr Al Shati’ Palace on Saturday with the Pakistani leader and wished him success in leading Pakistan towards further progress and prosperity over the coming period.
The two leaders exchanged greetings on the advent of Eid Al Fitr and wished progress and development to the Islamic world and all nations of the world.
Sheikh Mohamed emphasised the historical relations between the two nations and the valuable contribution made by the Pakistani community in the UAE to the country’s successful development drive.
He wished for permanent stability to prevail for the benefit of all peoples of the region, stressing UAE’S support for all steps conducive to achieving peace and cooperation in the region and the whole world.
The Pakistani Prime Minister thanked Sheikh Mohamed for the warm reception and congratulations on assuming the office of Prime Minister, commending the UAE’S great support for his country in the development field.
He stressed his keenness to strengthen relations with the United Arab Emirates in various fields, and to exchange views on the latest developments in the region and the world.
Shahbaz returned home on Sunday ater completing his three-day visit to Saudi Arabia. On his way back home, the prime minister made a brief stopover in the UAE where he held talks with Sheikh Mohamed Bin Zayed.
The meeting from the UAE side was attended by Lt. General Sheikh Saif Bin Zayed Al Nahyan, Deputy Prime Minister and Minister of the Interior, Sheikh Theyab Bin Zayed Al Nahyan, Sheikh Abdullah Bin Zayed Al Nahyan, Minister of Foreign Affairs and International Cooperation, Mohammed Bin Ahmed Al Bowardi, Minister of State for Defence Affairs, Dr Anwar Gargash, Diplomatic Adviser to UAE President, and Ali Bin Hammad Al Shamsi, Deputy Secretary-general of the Supreme National Security Council.
The Pakistan delegation that atended the meeting included Bilawal Bhuto, Minister for Foreign Affairs; Khawaja Muhammad Asif, Minister for Defence; Shahzain Bugti, Minister for Narcotics Control; Marriyum Aurangzeb, Minister for Information and Broadcasting and Asad Mahmood, Minister for Communication.
Earlier on Saturday, Shahbaz Sharif and Saudi Crown Prince Mohammed Bin Salman held discussions to further strengthen the bilateral, economic, investment and trade ties between the two countries.
During the meeting, issues of mutual, global and regional interest were also discussed between the two leaders during a meeting at the Royal Palace.
Shahbaz reached the Saudi port city of Jeddah on Friday and was received by Governor of Makkah Khalid Bin Faisal Al Saud and National Security Adviser Dr Musaed Al Aiban.
During the meeting, the premier also discussed job-creation opportunities in the kingdom for Pakistani expatriates. Earlier, upon his arrival at the palace, the premier was warmly welcomed by the crown prince. He was also given a guard of honour.
Shahbaz Sharif and his accompanied delegation also performed Umrah.
Pakistan has secured a “sizeable package” of around $8 billion from Saudi Arabia, including doubling of the oil financing facility, additional money either through deposits or Sukuks and rolling over of the existing $4.2 billion facilities during the visit of Prime Minister Shahbaz Sharif, said a report.
However, technical details are being worked out and will take a couple of weeks to get all documents ready and signed. While Prime Minister Shahbaz Sharif and his official entourage have let Saudi Arabia, Minister for Finance Mitah Ismail stayed there to finalise the modalities of the increased financial package.
Saudi Arabia also pledged “to further enhance the financing of petroleum products” at a time when the South Asian country is suffering from frequent power cuts.
Pakistan also welcomed a Saudi decision to extend an agreement to finance exports of crude oil products and oil derivatives, Saudi state news agency SPA reported.
In the statement carried by Pakistan state news agency APP, the Kingdom affirmed its continuous support to Pakistan and its economy “including the discussion of augmenting the $3 billion deposit with the central bank through term extension or otherwise, and exploring options to further enhance the financing of petroleum products and supporting the economic structural reforms for the benefit of Pakistan and its people”.
“Pakistan greatly appreciates the continued strong support of the Kingdom of Saudi Arabia to Pakistan,” the statement said.
Sharing the salient features of the financial package, an official said that Pakistan had proposed doubling the oil facility from $1.2 billion to $2.4 billion and the Kingdom of Saudi Arabia agreed to it. It was also agreed that the existing deposits of $3 billion would be rolled over for an extended period up to June 2023.
Pakistan and Saudi Arabia discussed an additional package of over $2 billion either through deposits or Sukuk and it is likely that even more money will be provided to Islamabad, said the official, adding that the size of the total package would be determined when additional money was finalised. Saudi Arabia had provided $3 billion deposits to the State Bank of Pakistan (SBP) in December 2021 while the Saudi oil facility was operationalised from March 2022 whereby Pakistan was provided $100 million to procure oil.
Saudi Arabia had provided a $7.5 billion package during the last tenure of the Pakistan Muslim League-nawaz (PML-N) government (2013-18). Under the Pti-led regime, Saudi Arabia had provided a package of $4.2 billion, including $3 billion deposits and $1.2 billion oil facility for one year and linked it with the IMF programme.
Now Saudi Arabia has provided an enhanced financial package to Pakistan when its economy is in dire straits and the country is facing a balance of payment crisis. The country’s foreign exchange reserves held by the SBP depleted by $6 billion in the last six to seven weeks and nosedived to $10.5 billion at the moment. With the rising current account deficit at $13.2 billion in the first nine months and pressing external loan repayment requirements, Pakistan requires financial injections of $9 to $12 billion till June 2022 to avert further depletion of foreign currency reserves. Pakistan will have to repay external debt servicing of $3 billion in the last quarter (April-june) of the current fiscal year.
The revival of the IMF programme is considered as imperative because the gross external financing requirement is estimated to the tune of $35 billion during the next fiscal year 2022-23 and without the backing of the programme, the huge financing gap cannot be bridged. However, independent economists, like Dr Ashfaque Hasan Khan, suggest a ban on the import of luxury cars and other unessential items for saving dollars.
“The litle financial help we can get from any country would help us given the condition of our economy,” Dr Kaiser Bengali, a veteran economist, told AFP. “But for how long will we run our economy on loans? This policy is not going to work even for the next five years.”