Qatar invests $3 billion in Pakistan economy | Business and economic news

The Qatar Investment Authority (QIA) aims to spend $3 billion on various commercial and investment sectors in Pakistan, which is currently facing a dire economic crisis, according to a statement issued by Qatar’s Amiri Diwan. Announced.

Wednesday’s announcement came during a visit to Doha by Pakistani Prime Minister Shebaz Sharif, who held official talks with Qatar’s Emir Sheikh Tamim bin Hamad Al-Thani after meeting with the QIA on Tuesday.

“His Highness underscored the importance of the fraternal and strategic relationship between the two countries and their aspirations to strengthen their economic partnership by promoting trade exchanges and facilitating investment through the Qatar Investment Authority. ‘, Amiri Diwan said in a statement.

A senior Pakistani official present at the meeting confirmed to Al Jazeera that the Qatari government had indicated “a willingness to invest in Pakistan.”

“This is very good and more than you need,” he said. The minister added that if Qataris buy Pakistani assets, it will “increase the reserves”.

“They are developing airports, port terminals, LNG-fired power plants, solar energy, [and] Stock market share,” he said.

Pakistan is currently facing severe economic turmoil and a balance of payments crisis, with foreign exchange reserves dwindling to $7.8 billion, barely short of imports for more than a month.

The country is also battling a widening current account deficit, a depreciation of the rupee against the US dollar and inflation that reached more than 24% in July.

During the session, the two leaders discussed Qatar-Pakistan bilateral relations and “how to support and develop the two countries in the fields of defense, economy, investment, trade exchanges, energy and sports,” and expressed their efforts. also discussed. A country that fights terrorism,” the statement said.

Ongoing IMF financing

Pakistan’s representative to the International Monetary Fund (IMF) said last week that the IMF’s executive board would meet on August 29 and decide to reopen a stalled $6 billion credit line to Islamabad.

Last month, the IMF said it had reached a staff-level deal with Pakistan that would pave the way for $1.17 billion in spending if approved by the IMF Executive Board.

Earlier this week, Pakistan’s central bank also publicly stated that the country’s external funding needs for the current financial year were “more than fully met” and “helped reduce external vulnerabilities”.

Commenting on the announcement, Uzair Younus, director of Pakistan Initiatives at the Atlantic Council’s South Asia Center, said the investment could help alleviate Pakistan’s short-term funding concerns. He said it had not addressed the core problems facing the country’s economy.

“Pakistan’s core problem is its inability to sustainably meet its foreign exchange needs,” Younus said. “Qataris will expect profits through these investments that will have to be repatriated in dollars.

Macroeconomist Ammar H Khan said Qatari investments would provide Pakistan with “valuable foreign exchange liquidity” in a tough environment.

However, he also agreed with Younus, saying the investment would not “alleviate the structural problems plaguing the country”.

“If QIA can improve governance and increase the value of state-owned enterprises through investments, it will be a welcome gain,” Khan said.

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