IMF approves $2.8b in fresh funds for Pakistan
Inflows will help country to combat challenges arising from Covid-19
PHOTO: AFP
KARACHI:
The International Monetary Fund (IMF) has approved allocation of new funds for its member countries, including Pakistan, to help them combat the challenges arising from the Covid-19 pandemic and put the global economy on a sustainable growth path.
Under the new allocations, Pakistan is estimated to receive $2.8 billion during the current month (August 23). The inflows are projected to lift the country’s foreign currency reserves to a new record high of over $20 billion.
Besides, the inflows will not only improve the country’s capacity to make payments for imports and repay foreign debt, but will also help arrest the rupee depreciation against the US dollar and other major currencies.
PSX ends near two-year high despite chaos
Research houses anticipate index to surge above 50,000 by end-2021
The SPV will also be listed on the Pakistan stock market by floating its shares in order to generate funds for the project. PHOTO: FILE
Pakistan’s stock market - a barometer to gauge economic performance - managed to maintain an uptrend, as it closed near a two-year high in 2020 following recovery of a badly riddled economy despite all odds, which included the outbreak of a pandemic and loud domestic political noise.
Pakistan Stock Exchange’s (PSX) benchmark KSE-100 index increased net 7.5% or 3,020 points during the year to close near a two-year high at 43,755 points on Thursday compared to 40,735 points on December 31, 2019.
Attracting investors to stock, debt markets a challenge
Low-interest rates, rupee depreciation likely to discourage foreign investors
PHOTO: REUTERS
KARACHI:
Pakistan’s economy is gradually moving towards stabilisation. The country’s foreign currency reserves hit a three-year high above $13 billion and the rupee consolidated at around Rs160 against the dollar.
However, attracting foreign investment into the stock and debt markets remains a huge challenge. Foreign investors have continued to divest from Asia’s best performing stock market for the past four years.
Similarly, they have aggressively pulled out investment from government debt securities since March 2020 after the central bank made a big cut in the benchmark interest rate to cope with the Covid-19 pandemic.