Chinese minister vows to back Pakistan’s economy

Pakistan gives assurances to visiting Chinese top diplomat new government will continue multibillion dollar CPEC project

Chinese minister vows to back Pakistan's economy

By Islamuddin Sajid

ISLAMABAD, Pakistan

Chinese Foreign Minister on Sunday vowed to further strengthen ties with Pakistan as analysts claimed the real aim of the visit was to seek assurances from new Pakistani government that its multibillion-dollar project would continue.

State Councilor and Foreign Minister Wang Yi arrived on a three-day visit to Pakistan on Friday, two days after U.S. Secretary of State Michael Pompeo visited Islamabad.

China will continue to prioritize Pakistan in its foreign policy and neighborhood diplomacy, Wang said during his meeting with Pakistan’s Prime Minister Imran Khan in capital Islamabad.

During their meeting, the Pakistani premier reassured the Chinese government’s top diplomat that the multibillion dollar China-Pakistan Economic Corridor (CPEC) would continue to be the government’s top priorities.

Analysts believe the aim of the three-day long visit of top Chinese diplomats was to engage with the new government and learn its position on the $64 billion CPEC project, which is a key part in Beijing’s ambitious One Road-One Belt project.

“The Chinese foreign minister’s visit is very important since he wants to know the vision of the new government and reassure his country’s full support to Pakistan,” according to Mushahid Hussain, an Islamabad-based political analyst.

The new government in Pakistan also gave assurances that the change in government would not affect ties with China, Hussain added.  

China rejects CPEC criticism

Wang also rejected criticism on the CPEC and said the project had not increased Pakistani debt.

“To our knowledge, 47 percent of the current debt comes from the international financial institution; when it comes to 22 CPEC projects, 18 of them are financed by direct Chinese investment and only four received concessional loans,” Wang said during a joint news conference with his Pakistani counterpart.

The CPEC has nothing to do with the debt burden of Pakistan but it helped the country and increased its economic growth by 1-2 percent and when these projects entered into operation it will provide huge financial benefits to the Pakistan economy, he added

Wang was referring to the U.S. Secretary of State Michael Pompeo’s statement in July who warned that any potential International Monetary Fund (IMF) bailout for Pakistan should not provide funds to pay off Chinese lenders.

CPEC, a mega project, signed in 2015, during the jailed former premier Nawaz Sharif government, aims to connect China’s strategically important northwestern Xinxiang province to Pakistan’s strategic Gwadar port through a network of roads, railways, and pipelines to transport cargo, oil, and gas.

The economic corridor will not only provide China cheaper access to Africa and the Middle East but will also earn Pakistan billions of dollars for providing transit facilities to the world’s second-largest economy. 

Expected bailout package

During his three-day stay in Islamabad, the Chinese foreign minister did not announce any urgent loan for Pakistan to bring the country out from the current account crises. However, he signaled that China is ready to help Pakistan.

“China is a country that values and cherishes its friendship with Pakistan. When China was in difficulty, Pakistan extended its support to it and now China wants to help Pakistan ” Wang said.

Pakistan is currently passing a worsening balance of payment crises. According to analysts, these crises may push the country to seek a fresh bailout from the IMF. However, Finance Minister Asad Umar told the Senate last week that IMF is not a final option but that they have several other options as well and would decide on the issue by the end of this month.

Analysts believe the U.S. could create hurdles for Pakistan if the country approached the IMF amid its current deteriorated relationship between the two allies in the war against terrorism.

China’s role is very important in the current situation because the U.S. would build pressure on the IMF to attach serious restrictions with its loans if Pakistan goes in that direction and that will create more difficult situation for the new government, Sarmad Salik, Islamabad-based political analyst told Anadolu Agency

It is not possible for China to resolve all financial problems of Pakistan; however, China’s immediate help can stabilize Islamabad during its current crises, Salik added.

During his stay in Islamabad, Chinese foreign minister also met Pakistani Army Chief Gen. Qamar Javed Bajwa and Speaker of the National Assembly Asad Qaiser.

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