DATE=11/25/98
TYPE=CORRESPONDENT REPORT
NUMBER=2-242151
TITLE=PAKISTAN I-M-F (L ONLY)
BYLINE=AYAZ GUL
DATELINE=ISLAMABAD
CONTENT=
VOICED AT:
INTRO: PAKISTAN SAYS IT HAS SUCCESSFULLY NEGOTIATED A 5.5
BILLION DOLLARS ECONOMIC BAILOUT PACKAGE WITH THE INTERNATIONAL
MONETARY FUND (I-M-F) AND THE WORLD BANK. BOTH INTERNATIONAL
FINANCE INSTITUTIONS HAD STOPPED LENDING TO PAKISTAN AFTER
SANCTIONS WERE IMPOSED ON THE COUNTRY FOR CONDUCTING NUCLEAR
TESTS IN MAY. AYAZ GUL HAS DETAILS FROM ISLAMABAD.
TEXT: AFTER TWO WEEKS OF INTENSIVE TALKS WITH I-M-F OFFICIALS,
PAKISTAN'S FINANCE MINISTER -- ISHAQ DAR -- ANNOUNCED THE
AGREEMENT AT A NEWS CONFERENCE IN ISLAMABAD (WEDNESDAY).
//DAR ACT//
I AM GLAD TO INFORM YOU THAT BY THE GRACE OF ALL MIGHTY
ALLAH, WE HAVE CONCLUDED OUR DISCUSSION WITH THE FUND
AND THE (WORLD) BANK. WE HAVE REACHED AN AGREEMENT WITH
THEM AND IN FACT IN ORDER TO DO THEIR REST OF THE
BUSINESS, THEY ARE ALREADY ON PLANE AND GOING TO
WASHINGTON. SO THIS IS A GOOD NEWS THAT THE FUND, THE
BANK HAD A COMPLETE AGREEMENT. THERE IS NO PENDING ISSUE
AND EVERYTHING STANDS RESOLVED.
//END ACT//
THE AGREEMENT IS EXPECTED TO END MONTHS OF ECONOMIC UNCERTAINTY
IN PAKISTAN WHERE ECONOMIC GROWTH IS AT A VIRTUAL STANDSTILL,
THE STOCK MARKET HAS PLUNGED TO RECORD LOWS, EXPORTS HAVE
DECLINED AND FOREIGN INVESTMENT IS DRYING UP.
MR. DAR SAYS THE LOAN PACKAGE WILL INCLUDE 1.33 BILLION DOLLARS
OF FRESH CASH INFLOWS FROM THE I-M-F, THE WORLD BANK AND THE
ASIAN DEVELOPMENT BANK. HE SAYS THE REMAINDER OF THE PACKAGE
INCLUDES 3.5 BILLION DOLLARS WORTH OF DEBT RESCHEDULING AND
RESTRUCTURING .
THE BAILOUT PACKAGE FOR PAKISTAN HAS TO BE APPROVED BY THE I-M-F
EXECUTIVE BOARD WHICH MEETS IN MID-DECEMBER IN WASHINGTON, BUT
PAKISTANI OFFICIALS DO NOT EXPECT ANY PROBLEMS.
I-M-F OFFICIALS SAY THE PACKAGE WILL ENABLE PAKISTAN TO NORMALIZE
PAYMENTS ON ITS EXTERNAL DEBT OF OVER 32 BILLION DOLLARS.
U-S-LED ECONOMIC SANCTIONS WERE SLAPPED ON PAKISTAN IN MAY AFTER
IT CARRIED OUT A SERIES OF NUCLEAR TESTS IN RESPONSE TO SIMILAR
TESTS BY NEIGHBORING INDIA. SANCTIONS WERE ALSO IMPOSED ON
INDIA.
PAKISTAN'S ALREADY TROUBLED ECONOMY WAS DEVASTATED BY THE
SANCTIONS. IN JUNE, THE GOVERNMENT OFFICIALS SAID THEY MIGHT
HAVE TO CONSIDER A MORATORIUM ON FOREIGN DEBT SERVICING UNLESS
INTERNATIONAL LENDING WAS RESUMED AND THE SANCTIONS LIFTED.
EARLIER THIS MONTH, THE UNITED STATES DECIDED TO WAIVE SOME
SANCTIONS ON BOTH THE COUNTRIES AFTER INDIA AND PAKISTAN
INDICATED THEY MAY SIGN THE COMPREHENSIVE TEST BAN TREATY BEFORE
SEPTEMBER 1999.
HOWEVER, PAKISTAN WANTS THAT THE U-S LIFT ALL SANCTIONS AGAINST
IT, INCLUDING BAN ON MILITARY PURCHASES FROM WASHINGTON. (SIGNED)
NEB/AG/KL
25-Nov-98 2:09 PM EST (1909 UTC)
NNNN
Source: Voice of America
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