The UAE has agreed to extend the tenure of its $2 billion in deposits with the State Bank of Pakistan (SBP) for an additional year, a move beneficial for Pakistan’s economy. These deposits, each worth $1 billion and set to mature in January 2024, will now continue to support Pakistan’s financial stability.
In a pertinent news release disseminated via social media, the central bank detailed the rollover, signifying ongoing international support amidst economic challenges. This extension follows the recent disbursement of a $700 million loan from the IMF, aimed at bolstering Pakistan’s financial reserves. The loan is a portion of the larger $3 billion Standby Arrangement (SBA) from the IMF, with total disbursements now reaching around $1.9 billion.
Governor Jameel Ahmed of SBP confirmed the latest IMF loan after their Executive Board concluded their initial review last week. Acknowledging the hopeful signs of economic revival and lessening external pressures noted by IMF Deputy Managing Director Antoinette Sayeh, Pakistan is beginning to witness early recovery indicators.
Nevertheless, securing the IMF bailout necessitated the adoption of stringent policy actions at the request of the IMF. Pakistan enforced harsh financial remedies, including a revised budget, an unprecedented interest rate spike, and sizable hikes in utility prices. These measures, coupled with new taxation efforts raising $1.34 billion for fiscal adjustments, escalated inflation to a historic 38% in May, with rates remaining above 30%.
SECP registered 220 New Real Estate Development and Construction Companies in December 2023.