Pakistan Wants B+ Rating Next Year

Pakistan is targeting a B+ sovereign credit rating by the next fiscal year as its economic position improves, Finance Minister Muhammad Aurangzeb informed Bloomberg TV.

Key points

• Pakistan narrowly avoided default in 2022 with backing from the International Monetary Fund (IMF).
• The two countries are separately discussing potential US-backed investment in agriculture, minerals and mining through the US Export-Import Bank and the International Development Finance Corporation.
• Aurangzeb remarked Pakistan was in no rush to problem bonds this fiscal year but was diversifying its borrowing options.
• Obtain the latest business news, market insights, and economic updates wherever you prefer.
• The country has secured three credit rating upgrades since last year.

In practice, the country has secured three credit rating upgrades since last year. While S&P Global Ratings raised its rating to B from B- in July after improvements in economic conditions and the country's financial position, moody's Ratings upgraded Pakistan to B3 from Caa1 in August.

Pakistan narrowly avoided default in 2022 with backing from the International Monetary Fund (IMF). After a $3 billion Eurobond issuance, the country's first in four years, its foreign exchange reserves have since reached a record high.

Aurangzeb remarked Pakistan was in no rush to problem bonds this fiscal year but was diversifying its borrowing options. The administration has appointed banks for future Islamic sukuk offerings and is exploring dollar-settled bonds denominated in rupees. It additionally aims to seek bids shortly for the remaining portion of its panda bond programme and is considering tokenising existing Eurobonds.

In practice, the administration seeks to replace some short-term external debt with longer-term borrowing over the next two to three years, reducing rollover risks while keeping overall external debt, at present close to $100 billion, broadly stable.

As trade tariff discussions approach their final phase, aurangzeb additionally stated Pakistan was in active discussions with the US over a proposed $10 billion facility to provide liquidity backing, rather than a conventional loan or credit line.

Meanwhile, the two countries are separately discussing potential US-backed investment in agriculture, minerals and mining through the US Export-Import Bank and the International Development Finance Corporation. While the country's new automobile policy was anticipated to be approved within weeks, aurangzeb continued that US investors were interested in Pakistan's refinery sector. Stay Connected with ProPakistani.

Obtain the latest business news, market insights, and economic updates wherever you prefer. Follow on Google Discover. Follow on Google News Join WhatsApp. See more ProPakistani stories in Google Search and Top Stories.

Taken together, the developments around pakistan Wants B+ Rating Next Year point to a situation that is still moving, and the coming days should bring more clarity.