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Security concerns: Top IMF aide calls off Islamabad visit

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ISLAMABAD:The International Monetary Fund’s deputy managing director, who was to discuss the disbursement of an additional loan of $1.25 billion, has cancelled her scheduled visit to Pakistan over security fears.

HunzaNews March 18th, 2014.

Nemat Shafik, the IMF’s deputy managing director, was scheduled to meet Prime Minister Nawaz Sharif and hold discussions with the country’s economic team, led by Finance Minister Ishaq Dar.

While talking to The Express Tribune, a senior official of the finance ministry revealed that Shafik’s visit had been cancelled but refused to say why.

According to sources, a travel advisory against Pakistan forced the IMF to review the decision of sending its top tier management to Islamabad.

Last month, the venue of Pakistan-IMF talks was moved from Islamabad to Dubai on similar grounds.

During Shafik’s visit, Pakistan was expected to push for an additional loan of $1.25 billion, aimed at boosting the fledgling foreign currency reserves. Excluding the one-off donation of $1.5 billion from Saudi Arabia, the country’s official foreign currency reserves stand at $3.2 billion, far below their level at the time of the country’s decision to enter into a new IMF arrangement.

Pakistan has not yet formally moved a case for the additional loan and was seeking the IMF’s nod before sending a request to the Fund’s executive board.

During his last visit to the US, Finance Minister Ishaq Dar had sought an additional loan of $1.25 billion. At that time, Nemat Shafik had promised to review the request once Pakistan successfully completed the second review of the $6.7 billion.

The second review has already been completed and the executive board of the IMF will meet on March 24 to approve the third loan tranche of $550 million, according to the IMF’s calendar.

The executive board will also grant two waivers to Pakistan on account of Islamabad’s failure to fulfill the conditions of reducing borrowings from the central bank and retiring loans obtained under forward contracts.

Commenting on the issue, a source said that unlike the past, this time the United States has left the decision of approving the additional $1.25 billion to the IMF’s management.

Any favourable decision by the monetary body will determine whether the IMF would like to have a longer arrangement with Pakistan and would not leave the country by end of this year, as widely anticipated, the source said.


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