Pakistan’s PM lands in Beijing to discuss economy, debt

Pakistan’s Prime Minister Shehbaz Sharif arrived in Beijing on Tuesday to meet Chinese leaders and discuss plans for the China Pakistan Economic Corridor (CPEC), a $65 billion investment in the South Asian nation.

The major investment in development and energy projects in Pakistan is part of President Xi Jinping’s Belt and Road Initiative (BRI) to improve China’s road, rail and sea routes with the rest of the world, Reuters reported.

Islamabad and Beijing are considered longtime close allies, and Sharif is also expected to discuss security issues while on his visit.

On his two-day maiden visit to Beijing since taking office in April, Sharif will also seek some debt relief from China, in particular the rolling over of bilateral debt, an aide travelling with the prime minister told Reuters.

Chinese loans – around $23 billion – make up the largest chunk of Pakistan’s $27 billion of bilateral debt.

Sharif will be one of the first leaders to meet Xi since he secured a third term in power.

Pakistan had been struggling with a balance of payments crisis even before devastating floods hit the country over the summer, causing it an estimated $30 billion or more in losses.

“My discussions with the Chinese leadership will focus on revitalization of CPEC among many other things,” Sharif said in a statement adding that he will be meeting Xi and other Chinese executives while there.

Sharif’s government alleges that the CPEC project was slowed down during the tenure of ousted former premier Imran Khan, a charge the latter denies.

Sharif’s delegation among others includes the finance and energy ministers.

Pakistan has indicated previously that it will seek bilateral debt relief to lessen its balance of payment problems, but it hasn’t made any official announcement on whether it will formally ask Beijing for such help.

Pakistan’s central bank reserves have fallen to as low as $7.4 billion, barely enough for one and a half months of imports.