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Pakistan Aide -- No Debt Write-off Until After IMF Deal
Friday, September 21, 2001

WASHINGTON -- Reuters
Pakistan has not yet formally asked for any write-off of its debts with other countries because it first has to reach a deal with the International Monetary Fund on a new program, an official at the Pakistan embassy said.

The cooperation of Pakistan with the United States in the wake of the attacks on New York and the Pentagon last week is expected to win it favorable treatment on the international financial stage, where the United States is often the most influential player.

"Pakistan hasn't asked for writing off of debt at the moment," Tanwier Agha, the economic minister at the Pakistan embassy here, told Reuters.

"So whatever happens will be within the framework of an agreement with the Paris Club which will take place after we have this PRGF (Poverty Reduction and Growth Facility) tied up," he added.

The Paris Club is an informal group of creditor countries that meets when an indebted country is having trouble making payments on its debt to members of the club. The debtor country then attempts to renegotiate terms of its debt.

Pakistani finance officials are expected in Washington next week for talks with the IMF.

On Sept. 26, the Washington-based lender is tentatively scheduled to discuss the final review of Pakistan's $596 million standby loan with the IMF which is due to expire on Sept. 30. If Pakistan passes the review, it will pave the way for the release of $130 million. Pakistan is then hoping to reach agreement on the new PRGF program.
(More: Excite.com News Source)

Dan