China endorses Pakistan’s request for IMF bailout ahead of Imran visit

WITH PAKISTAN PM’S VISIT SCHEDULED IN NOVEMBER, IT IS EXPECTED MORE AGREEMENTS WILL BE ANNOUNCED BY THE TWO COUNTRIES

ISLAMABAD : China has endorsed Pakistan’s request to the International Monetary Fund (IMF) for financial aid to address its economic challenges, but at the same time said the facility should not affect economic cooperation between Islamabad and Beijing.

The statement came ahead of Prime Minister Imran Khan's visit to China in November, when it is expected more financial and trade agreements will be announced by the two countries.

“As a member of the IMF, China supports the organisation in making an objective evaluation of Pakistan based on professionalism and earnestly helping it properly address the current difficulty,” Chinese foreign ministry spokesperson Lu Kang said at a news briefing in Beijing. His remarks were shared by the Chinese embassy in Islamabad.

Pakistan last week formally applied for an IMF package to deal with an impending balance of payments crisis. Though it isn’t clear how much money Pakistan will require, Khan has said the country could need around $12 billion to deal with its problems.

A team of IMF officials is scheduled to visit Islamabad on November 7 for talks on the size of the loan that Pakistan will require.

As IMF considers Pakistan’s request, its managing director Christine Lagarde said the lender will need to determine the country’s debt sustainability by having “a complete understanding and absolute transparency about the nature, size and terms” of its debt.

Media reports suggested that Pakistan, which is undertaking the China-pakistan Economic Corridor (CPEC), a massive infrastructure and connectivity project with China, is in a difficult situation because of mounting Chinese debt. This view is supported by the US, which has significant influence on the IMF board.

Chinese spokesman Lu strongly rejected the perception that CPEC debt is adding to Pakistan’s financial woes.