https://arab.news/8g7kg
- Payment is part of $4.5b agreement signed in June to finance Pakistani oil and gas imports for three years
- Pakistan, ITFC discuss ways forward to utilize financing of up to $1.5 billion annually
ISLAMABAD: The International Islamic Trade Finance Corporation (ITFC), a subsidiary of the Islamic Development Bank, will provide Pakistan a $600 million syndicated loan for trade financing within a month, the Pakistani government said on Monday.
The agreement was reached at a virtual meeting between Pakistan’s Economic Affairs Minister Omar Ayub Khan and ITFC Chief Executive Officer (CEO) Hani Salem Sonbol.
“The CEO ITFC updated that the ongoing syndication is about to complete and $600m will be available to Pakistan during this month,” the Economic Affairs Division of the Pakistani government said on Twitter.
Minister Khan appreciated ITFC for arranging financing of about $7 billion for the import of oil and LNG. The two sides also discussed the way forward to utilize financing up to $1.5 billion annually.
The Ministry of Economic Affairs said in a statement the ITFC chief had said Pakistan was a top priority country for investment in trade financing and to help meet the country’s petroleum, oil and lubricants (POL) procurement requirements. Khan and the ITFC chief also discussed how ITFC could arrange financing for broader trade activities in Pakistan under commodity financing.
Since its inception, the ITFC has approved $6.2 billion to support Pakistan’s energy sector, the Corporation said in a Twitter post. The two sides in June signed a three-year agreement for a total amount of $4.5 billion to finance oil, liquefied natural gas (LNG) and fertilizer imports over the next three years (2021-23) as well as trade development activities.
The financing agreement is to be utilized by Pakistan State Oil (PSO), Pak-Arab Refinery Ltd. (PARCO) and Pakistan LNG Ltd. (PLL) for the import of crude oil, refined petroleum products and LNG, the Dawn newspaper reported.
Within the context of its trade integrated solutions approach, the framework agreement also covers ITFC’s support for trade-related technical assistance projects in Pakistan, which will be selected jointly by both parties according to the national economic priorities and development plan of Pakistan, according to the report.