Pakistan is to make a statement by the end of the week about its dire financial situation, officials said Wednesday, amid reports that an application to the International Monetary Fund is imminent. "We will make a statement on this issue in a day or two," a government official told AFP, speaking on condition of anonymity.
But he said he could not comment on a report in the Financial Times quoting another Pakistani government official as saying negotiations with the IMF were in their final stages. The report added that Islamabad expected agreement on a letter of intent with the world body "within one or two days".
No-one at the IMF in Pakistan was immediately available for comment when contacted by AFP. Pakistan needs up to 4.5 billion dollars (3.5 billion euros) to deal with a balance of payments crisis, raising the prospect that the violence-hit country will default on its foreign debts. The government has previously said that any application to the IMF would be a last resort and only when all other options have been exhausted.
German's Foreign Minister Frank-Walter Steinemeier met his Pakistan counterpart Shah Mehmood Qureshi and President Asif Ali Zardari in Islamabad on Tuesday and promised the country IMF help to overcome its financial woes. Speaking after talks with both men, he said he hoped the IMF would make a quick decision "not in six months or six weeks, but in six days".
All dialogue partners had signalled that the country would not be able to carry on without IMF help and Pakistan must be enabled to overcome the crisis through appropriate IMF credit, he added. "Credit will only help if it comes in the next six days," he said. "We hope the help will come rapidly so that the country can get over the next few months."
Pakistan is suffering badly under high oil and food prices plus a plunging rupee and has only about three weeks of foreign reserves. The government hesitated for a long time about approaching the IMF because its credit will only be given under strict conditions.
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