Market expects Geneva pledges to help ease pressure on foreign exchange reserves

KARACHI: With some $10 billion commitments in the Geneva Conference, the default risk has further reduced and the market is expecting some stability in the currency market.

Malik Bostan, President Forex Association of Pakistan, has said that government has successfully presented its case in the Geneva Conference titled ‘Climate Resilient Pakistan’, resultantly the international financial institutions and other countries have pledged more than 10 billion dollars.

During the Geneva Conference held on 9th January, Pakistan has received pledges some $10 billion dollar for recovery and rehabilitation of the flood-affected people and areas. This include to $4.2 billion from Islamic Development Bank in three years, $1 billion from Saudi Arabia, World Bank $2 billion, ADB $1 billion, European Union EUR 0.5 billion, USAID to $ 100 million, Japan USD 77 million and Germany EUR 84 million.

Bostan said that these pledges are more than expectation and with maturity of these vows, the ongoing crisis of foreign exchange will ease. He said that these inflows will also help to control volatility in the currency market, besides stability in the exchange rate.

He said that as per reports a meeting with the IMF delegation was also held on the sideline of the Geneva Conference and if it is successful then the country will receive another one billion as a tranche of Extended Fund Facility (EFF) of IMF program.

Bostan said that as a number of countries have pledged healthy funds for Pakistan, there is need to make efforts for timely maturity of these pledges, so we can overcome from the ongoing crisis of foreign exchange.

He appreciated the efforts of Prime Minister Shehbaz Sharif and Minister Finance Ishaq Dar for getting over $10 billion commitments from the international financial institution and friendly countries.

“This is the big achievement and country’s economy will come on right track as there is no doubt that Pakistan is one of major affected country of climate change,” he said.

Copyright Business Recorder, 2023