Pakistan’s finance minister, Muhammad Aurangzeb, has approached US Treasury Secretary Scott Bessent for a $10 billion Exchange Stabilisation Support Facility to enhance the country’s foreign exchange reserves and alleviate debt burdens. The request was confirmed by officials at Pakistan’s embassy in Washington during discussions with Bessent, although specific details were not disclosed.
The proposed facility, if approved, would enable the US Treasury to provide loans or financial support through its Exchange Stabilization Fund to reinforce Pakistan’s reserves. Pakistan’s economic strategy emphasizes enhancing access to international capital markets, fortifying foreign exchange reserves, and improving sovereign credit ratings, according to official statements.
Aurangzeb, in a meeting with Bessent, highlighted Pakistan’s efforts towards achieving macroeconomic stability, sustainable growth, and promoting exports. He also underscored the negative impact of regional security issues on the country’s economy. Diplomatic sources in Washington have indicated optimism regarding the approval of Pakistan’s $10 billion request, with the Trump administration expressing interest in maintaining ties with Pakistan.
Recent reports have highlighted the economic challenges facing Pakistan, including a significant inflation rate of 11.7% in May. Economists have warned of the potential for weak growth, escalating prices, and financial stress. Factors such as surging transport costs, rising food prices, foreign exchange constraints, and increased oil import expenses have collectively weakened purchasing power and hampered economic activities.
Pakistan’s vulnerability to external shocks has been exacerbated by global disruptions, particularly due to the US-Iran tensions. The country’s heavy reliance on imported energy and its fragile balance-of-payments position have heightened its susceptibility to such disturbances.
