Saudi Arabia pledges $3bn to Pakistan, defers oil payments

In this handout photograph released by Pakistan’s Press Information Department (PID) on October 23, 2018, Saudi King Salman meets with Pakistan’s Prime Minister Imran Khan during a meeting in Riyadh. Saudi Arabia. (AFP)
Updated 24 October 2018
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Saudi Arabia pledges $3bn to Pakistan, defers oil payments

  • It was agreed Saudi Arabia will place a deposit of $3 billion for a period of one year as balance of payment support: statement
  • Pakistan is seeking foreign aid to help plug a massive budgetary gap which the Pakistan prime minister has blamed on the mismanagement of the previous administration

RIYADH: Saudi Arabia has pledged $3 billion in support to Pakistan and allowed for deferred oil payments to help stave off a budget crisis.

The deal came as Pakistani Prime Minister Imran Khan attended the opening of the Future Investment Initiative (FII) in Riyadh on Tuesday.

Earlier Khan met with King Salman and Crown Prince Mohammed bin Salman to discuss bilateral issues. It was his second visit to the Kingdom in just over a month.

“It was agreed Saudi Arabia will place a deposit of $3 billion for a period of one year as balance of payment support,” Pakistan’s Foreign Ministry said in a statement.

“It was also agreed that a one-year deferred payment facility for import of oil, up to $3 billion, will be provided by Saudi Arabia. This arrangement will be in place for three years, which will be reviewed thereafter.”

During his address to the gathering of global business executives, Khan also confirmed that Pakistan was in talks with the International Monetary Fund (IMF) for a new bailout.

Pakistan is seeking foreign aid to help plug a massive budgetary gap which the Pakistan prime minister has blamed on the mismanagement of the previous administration. During his election campaign, the former cricketer vowed to create 10 million jobs and establish an “Islamic welfare state.”

After a consultative visit last month, the IMF had warned that Pakistan needed to quickly secure “significant external financing” to avert a crisis. 

Saudi Arabia and Pakistan have also discussed potential investment in mineral resources in Balochistan, the largest of Pakistan’s four provinces which borders Iran and Afghanistan.

Further discussions were held about a refinery project in Pakistan, the Finance Ministry said in the statement.

Pakistan’s external balance of payments represents one of the biggest challenges facing Khan.

The country’s current account deficit has ballooned as its central bank’s foreign reserves dropped to about $8.1 billion in October.

That was barely enough to meet the country’s sovereign borrowings between now and the end of the year.

The IMF expects Pakistan’s economic growth to slow to about 4 percent in 2019.

Pakistan is seeking to attract increased inward investment to help shore up its finances and Khan used the event as platform to talk about opportunities in sectors such as tourism, minerals, coal and gas exploration.

He also highlighted what he said were the successes of Pakistan in the fight against terrorism, which has brought peace and stability to the country, and pointed to the significance of the China-Pakistan Economic Corridor (CPEC).

China has become an increasingly high-profile investor in Pakistan as Beijing pushes ahead with major projects such as the CPEC.


Saudi Shoura Council urges promotion of culture of productivity in families

The Shoura Council holds its first ordinary session in Riyadh on Tuesday. (SPA)
Updated 13 min 46 sec ago
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Saudi Shoura Council urges promotion of culture of productivity in families

  • The council encouraged the Family Affairs Council to build partnerships with the nonprofit sector to implement its initiatives

The Shoura Council called upon the Family Affairs Council on Tuesday to build and promote the family’s culture of productivity and self-reliance as one of its strategic pillars, and accord top priority to preparing a draft strategy for the family in coordination with the relevant authorities.

The council adopted this resolution during its first ordinary session of the third year of the seventh session, held under the chairmanship of Shoura Council Speaker Sheikh Abdullah bin Mohammed Al-Sheikh.

The council encouraged the Family Affairs Council to build partnerships with the nonprofit sector to implement its initiatives, and formulate a scientific description of the characteristics to be instilled in the Saudi family and the enabling supportive environment. 

Assistant Speaker of Shoura Council Yahya Al-Samaan said the council has asked the Public Education Evaluation Commission to focus on leveraging national expertise and to reduce reliance on foreign expertise.

Al-Samaan pointed out that the council made its decision after listening to the views of the members of the Education and Scientific Research Committee on the report submitted by the Public Education Evaluation Commission for the current fiscal year.

On Monday, King Salman inaugurated the third year of the Shoura Council’s seventh session in which he highlighted the Kingdom’s priorities for the coming year and defined the contours of its domestic and foreign policies.

The king pledged to continue the Kingdom’s fight against extremism and all forms of terrorism. He also vowed to support the system of social services and sustainable growth for citizens. 

The speech focused on issues such as the war in Yemen, the Palestinian issue, stability in the oil market, countering Iranian interference in the region and job creation for Saudis.  “The Kingdom will maintain its effort to resolve regional crises,” the king said.

Al-Sheikh noted the council’s pride in the wise leadership’s efforts to unify Arab ranks and promote Islamic solidarity to achieve security and peace in the region and in the world.