External Public Debt in Financial Year 2018-19 is lowest in 3 years
- The Economic Affairs Division showed that external public debt during the financial year 2018-19 is only $2.29 billion.
- A statement from Division read that the government is expecting strong inflows from its development partners this year.
- It also read that the slowdown in payment from development partners was due to a period of political transition in the country.
The Economic Affairs Division said that the external public debt during the financial year 2018-19 is only $2.29 billion which is the lowest in the last three years.
In a press release, the Economic Affairs Division said:
“Total external inflows during the financial year 2018-19 were $10.186 billion, including grants of $330 million. Whereas the government obtained $9.85 billion external loans, including the government making payment of $8.94 billion on account of retirement of external debt and debt servicing.”
It further added that net addition to the external public debt clocked in at $2.29billion.
The division said that comparatively, net additions to the external public debt during the last three fiscal years (the financial year 2015-16 to the financial year 2017-18) were $6.82billion, $4.77bn and $8.64bn respectively.
The World Bank and the Asian Development Bank paid $541.17 million and $652.75million respectively during the financial year 2018-19 as compared to $945.69million and $817.54million during the financial year 2017-18.
The Economic Affairs Division underscored that budgetary support was not available due to the weak macroeconomic position inherited by the incumbent government.
The press read:
“Provincial governments’ Annual Development Plans were approved at a delayed stage after the development of the elected government. Therefore, approval of project-related disbursement and new lending operations were slow during the initial months and started to pick-up during the second half of the year.”
The press also read that slowdown in payment from development partners during the outgoing financial year, was due to a period of political transition in the country.
There was a complete ban by the Election Commission of Pakistan on new development projects by the interim government and that’s why relevant forums were not in place for quite some time.
“With the good prospects of budgetary support and the confidence of international financial institutions, the government is expecting very strong inflows from its development partners this year.”
The statement read that the government resorted to commercial borrowing only as a possible measure to strengthen foreign exchange reserves and to maintain stability in the market.