Hafeez Shaikh caps off 'successful' US tour securing promises of aid, loans

Published: April 24, 2012

Pakistan’s Finance Minister Hafeez Shaikh says policies of current government have put Pakistan economy on the path of stability, growth. PHOTO: AFP/FILE

WASHINGTON: Federal Finance Minister Hafeez Shaikh, wrapping up a week long tour in Washington, said that Pakistan will be receiving as much as $5.27 billion from the US, UK and international monetary organisations over the next four years.

Having met managing director of the World Bank Sri Mulyani, the Asian Development Bank President Haruhijo Kuroda, US AID administrator Dr Rajiv Shah, Sheikh, and IMF Pakistan mission chief Adnan Mazarei among senior US officials, confirmed that both the Asian Development Bank and the US have reaffirmed investment in to the Diamer Bhasha dam project in Pakistan. “We have told the ADB to send their assessment team to Pakistan soon,” the Finance Minister said.

Addressing a press conference at the Pakistani Embassy in Washington, DC, Shaikh said that the US has also agreed to invest in the renovation of the Mangla Dam, and for the Kurram-Tangi dam project. He said the US government had notified Congress that it would be spending $223 million on the projects.

Shaikh, who is wrapping up a one-week trip to Washington DC where he and his finance team attended the IMF/World Bank Spring Meetings 2012, said the International Finance Corporation, part of the WB group, would also invest $1 billion in various sectors in Pakistan’s private sector, including energy and finance. Shaikh said that the IFC investment was the highest for the group in Pakistan. He also added that the World Bank had increased its spending on Pakistan from $1.6 to $1.8 billion. Dr Shaikh also said that Britain had announced that Pakistan would be its biggest recipient of aid. “Britain will spend over $2.25 billion over the next four years, primarily in the field of education.”

While highlighting the increasing number of remittances, a higher growth rate and growing exports as signs of progress in Pakistan’s economy, Dr Shaikh said that the rising oil prices may impact Pakistani exports in the future. He added that if the economic conditions of Europe worsened, that too could impact Pakistan.

Record breaking foreign remittances expected

Shaikh said that Pakistan is due to receive a record $13.5 billion in foreign remittances this year in a sign of confidence of overseas Pakistanis’ in the economic policies of the government. “Overseas Pakistanis posing confidence in Pakistan, will send $ 13.5 billion this year, reflecting a 21 per cent increase from last year’s $ 11.2 billion,” the finance minister proudly announced at the press briefing.

Claiming that the national economy was now on the path to stability and growth, Dr Shaikh said that Islamabad’s policies are yielding results despite soaring international oil prices and uncertain global economic situation and that this year Pakistan’s economy will grow at four per cent of the GDP, the highest growth seen over the past five years.

He recounted a host of positive indicators including six per cent expansion in exports, which follow a 30 per cent increase in exports last year, and a jump of 25 per cent in revenue collection in the past nine months from

Reader Comments (23)

  • Bhindian
    Apr 24, 2012 - 2:24AM

    what a success, I am really proud /sarcasm

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  • gp65
    Apr 24, 2012 - 3:11AM

    Britain’s 2.5 billion over 4 years is aid and does not reflect confidence (or lack thereof) in Pakistan. It is a foreign policy success where the extremely large Pakistani diaspora must have played a part in influencing.

    The World Bank loan must be based on US pressure on world bank as a quid pro quo for laying of IP and also to open the supply routes for NATO.

    Undoubtedly the remittances are a bright spot in Pakistani economy. I am however surprised to see a reference to a 6% growth in exports. I thought they were stagnant in value terms and had in fact down in volume terms due to the electricity crisis.

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  • Apr 24, 2012 - 3:40AM

    congratulations PPP u hav just got money for ur election campaign, aid is just a bribe money for our corrupt politicians, neither nation demanded it nor they need this filthy money

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  • Amjad
    Apr 24, 2012 - 4:14AM

    I can’t understand why the Pak government doesn’t ask for all of the nation’s outstanding loans to be written off as partial compensation for all the suffering and sacrifice Pakistan made in defeating the Soviets, ending the Cold War, and fighting the war on terrorism. Look at how tens of billions in debt have ben written off for European countries such as Greece. Pakistan has saved the West hundreds of billions if not trillions by defeating the Soviets and ending the Cold War.

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  • Apr 24, 2012 - 4:21AM

    How can further aid and loans be good for any country? It is easy to borrow but giving back is when you run into problems. Aid and loans is a curse that Pakistan must avoid.

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  • geeko
    Apr 24, 2012 - 4:36AM

    Shaikh said that Pakistan is due to receive a record $13.5 billion in foreign remittances this year in a sign of confidence of overseas Pakistanis’ in the economic policies of the government. “Overseas Pakistanis posing confidence in Pakistan, will send $ 13.5 billion this year, reflecting a 21 per cent increase from last year’s $ 11.2 billion,” the finance minister proudly announced at the press briefing.

    Lol, it’s either trust in the government, or because their relatives are dying hungry and they have to send them money. Recommend

  • Syed
    Apr 24, 2012 - 4:41AM

    Hahahah! Sheikh ji is laughing in the picture, so am I. But for a different reason. Same old path to ‘successful’ economic recovery; qarz, beggary and IMF. They just cannot outgrow the vicious circle.

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  • blithe
    Apr 24, 2012 - 5:08AM

    This Govt has increased total debts by over 85% in its 4 years.
    Then we wonder why the crowding out effect is taking place.
    , ie private sector not being able to borrow
    at these high KIbor rates.

    Bogus schemes like bisp need to be demolished.
    Fiscal discipline needs to be brought back in.
    Hafeez Shaikh needs to resign

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  • Pinto
    Apr 24, 2012 - 5:10AM

    What a waste of money

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  • Balma
    Apr 24, 2012 - 5:14AM

    World bank, IMF everyone should stop all aid to Pakistan till the tax base in Pakistan is expanded.
    Otherwise, bayghairat nation’s doubly bayghairat vazeers will continue to walk around the world with kashkole. Shame on Pakistanis for being jubiliant on receiving zakat khariat of the world.
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  • Dude
    Apr 24, 2012 - 5:21AM

    I have no idea where he gets his data from?
    I guess he fabricate it just like his leader Zardai and rehman Malik.
    These people need to get their heads out of sand.

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  • yajsingh
    Apr 24, 2012 - 5:47AM

    Since when did “aid” become a corner stone of a countries fiscal policy and promise of “receiving aid” a measure of successful investment ?

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  • Imran
    Apr 24, 2012 - 5:52AM

    Shame!! Give us loans so our kids and their kids and their kids keep paying it off for centuries to come….

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  • Russianroulette
    Apr 24, 2012 - 6:36AM

    This finance minister has had so much time to do so much and yet under his stewardship the outcomes are pretty lame! When will ZZZZ wake up?

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  • Apr 24, 2012 - 6:42AM

    We are so proud for not only going deeper in debt, paying usury and losing any self respect and independence which is left to International banking cabals.

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  • A.Raja Rao
    Apr 24, 2012 - 6:42AM

    What about honour and sovereignty- How can Pakistan go to Washington and ask for money when its people in Pakistan want only honour and self respect and sovereignty

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  • Apr 24, 2012 - 6:57AM

    Most developing nations, including India, need foreign inflows to fund development. So does Pakistan. It’s better if the bulk of such inflows are in the form of FDI rather than debt. In any event, it’ll be helpful for Pakistan to have a combination of remittances, debt and aid coming into the country to stimulate the economy.

    http://www.riazhaq.com/2012/01/is-india-heading-toward-debt-crisis.html

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  • M. Adil
    Apr 24, 2012 - 7:01AM

    Someone sure seems pleased after going round begging for aid and assistance. I would be absolutly ashamed that my country had to do this year after year, or we’d be bankrupt. And this is the same west that millions of Pakistanis love to hate and vow to fight against. I wonder how many students will be utilising some of the $2 biilion for their education over the coming years and then burning UK flags and shouting anti west slogans? Shouldn’t they be taught that their education is being paid for not by Saudi Arabia and China etc, but by their infidle cousins, from where the brothers will also send in billions more in foreign remittance. And instead of burning anti western flags, maybe for once we should be show some appreciation of the aid and assistance that we so readily consume year after year. It might just make us some friends around the world – as at the moment we haven’t got many. Friends in need, friends in deed.

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  • Not me
    Apr 24, 2012 - 7:43AM

    Do not trust a word he says.The tax to GDP ratio is lowest in the world and he has done nothing to improve it in last 3 years
    All he is at present interested in is NRO for Stock Exchange so that potential money laudarying starts

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  • SM
    Apr 24, 2012 - 8:14AM

    How can we be proud of success in begging others to give us money?

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  • Apr 24, 2012 - 8:17AM

    NATO route reopening and this must be linked.

    I’ve not seen this sort of news since there was a blockade. I do not think this is a coincidence. Its quid pro quo.

    This amount is enough to artificially sustain Pakistan and other similar dozes will be required to keep it stable till 2014, when NATO pulls out. But, I can’t see any reason why this sort of arrangement will continue post 2014. Why will US or any NATO country give Pakistan money, after all that Pakistan has done for NATO by sheltering people like Osama and not attacking North Waziristan?

    Pakistan will be lucky if it doesn’t get sanctioned post-2014.

    Another point is that despite Pakistan is indeed dependent on US for its economic survival, but still people will hate US.

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  • MarkH
    Apr 24, 2012 - 8:45AM

    @Amjad:
    You didn’t fight the Soviets out of the kindness of your own hearts. Your own existence was threatened and you were propped up (given a lot) throughout it and afterwards. Do you think it’s only just recently that you’ve been getting things? From the start of your very existence the US was approached to help you and it did. You’re also not fighting the war on terror out of the kindness of your own hearts. From the start you had to be pressured and as it has dragged on you’re lucky you did because if it wasn’t for that you’d be on the receiving end of NATO’s hostility because you’re obviously complicit in supporting the enemy. So obviously complicit that the “with us or against us” line being used at the beginning was probably a blessing in disguise. The only thing keeping that from happening is your conveniently timed mentioning of the “sacrifices” you’ve made which, I might add, have been from TTP and your very own assets for the most part. They’ve told you bluntly many times, US or no US, they’re going to be killing you.

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  • j. von hettlingen
    Apr 25, 2012 - 8:14PM

    Let’s hope that the money will be used wisely for strengthening Pakistan’s economy and creating jobs.

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