Jameel Ahmed says at present, we have no intentions of pursuing any debt restructuring.
KARACHI: (UrduPoint/Pakistan Point News-June 13rd, 2023) The Governor of the State Bank of Pakistan (SBP), Jameel Ahmad said that Pakistan had no plans for bilateral debt restructuring, contrary to the earlier statement made by Finance Minister Ishaq Dar.
Governor Ahmad categorically stated, "At present, we have no intentions of pursuing any debt restructuring," said the SBP governor during briefing to the analysts on Monday.
He said, "There is absolutely no doubt about it. We are not considering any such plan, so there is no question regarding the potential haircut,".
The SBP governor explained that the majority of the debt comprises bilateral and multilateral loans, with significant amounts already paid towards commercial debt and upcoming payments for Eurobonds, as reported by Topline Securities.
Regarding the external repayment due this month, amounting to $3.6 billion, Governor Ahmad mentioned that $0.4 billion has already been repaid, while the remaining balance of $2.3 billion will be rolled over, and $0.9 billion needs to be financed.
The SBP projected a total debt requirement of approximately $23 billion for the fiscal year 2024, which will be distributed evenly across the four quarters. The funding for this will be determined in the upcoming monetary policy statement, considering various factors including the IMF.
Governor Ahmad stated that discussions with the IMF are ongoing, expressing optimism that the review will be concluded soon.
He also anticipated that the government would receive Rs1 trillion as a transfer from the SBP, resulting from the profit earned during the fiscal year 2024, after retaining a specific portion.
The SBP expects the current account deficit (CAD) for the fiscal year 2023 to close at around $3.5 billion, with a worst-case scenario of $4 billion, attributable to import restrictions implemented through policy measures and the availability of liquidity from exports and remittances.
Furthermore, the projected CAD for the fiscal year 2024 is expected to remain below $4 billion.
Governor Ahmad stated that the government will determine the appropriate timing for issuing Eurobonds, considering market fundamentals and credit ratings.
After presenting the Federal budget for the fiscal year 2024, Finance Minister Dar mentioned that the government was exploring the possibility of restructuring its bilateral debt, irrespective of the completion of theIMF review.
