Pakistan seeks $10 billion facility from US, submits bid to Treasury Department
Pakistan has struggled with external payment pressures for years and came close to default in 2023 before securing timely assistance from the International Monetary Fund (IMF) and bilateral partners.
Pakistan is requesting a $10 billion facility from the United States in an effort to strengthen its foreign exchange reserves and reduce reliance on emergency financial support from allies. Finance Minister Muhammad Aurangzeb disclosed that Pakistan had submitted the request to the US Treasury Department, with ongoing discussions taking place, though no final agreement has been reached.
The proposed Exchange Stabilisation Support Facility would serve as a symbol of currency and foreign exchange stability, according to Aurangzeb, rather than a conventional loan or credit facility. The facility aims to reinforce stability in the foreign exchange market and signal to international capital markets that Pakistan can access global markets.
Pakistan is also working to improve its credit standing and access global capital markets by implementing an IMF program and strengthening its reputation. The country has been grappling with external payment pressures for years, coming close to default in 2023 before receiving financial aid from the International Monetary Fund and bilateral partners.
Pakistan's sovereign rating has remained unchanged since 2003-04, but the government hopes a stronger rating will enable access to international markets at lower borrowing costs. The finance minister expects to receive feedback from Exim Bank or the US Treasury by the end of September.
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