The United States is concerned about debt owed to China by Pakistan and other countries, US State Department Counselor Derek Chollet said on Thursday during a visit to Islamabad as the country dealt with a severe economic crisis.
Pakistan, historically a close ally of Washington, has become increasingly close to China which has provided billions in loans and is Islamabad's largest single creditor. Pakistan is also facing a crippling economic crisis, with decades-high inflation and critically low foreign exchange reserves depleted by continued debt repayment obligations.
"We have been very clear about our concerns not just here in Pakistan, but elsewhere all around the world about Chinese debt, or debt owed to China," Chollet told journalists at the US Embassy in Islamabad after he met with Pakistani officials.
China and Chinese commercial banks held about 30% of Pakistan's total external debt totaling about $100 billion, according to a report by the International Monetary Fund released in September 2022.
Much of that debt has come under the China Pakistan Economic Corridor (CPEC), part of Beijing's Belt and Road Initiative. A proportion of that debt coming due in 2023 and 2024 has increased the pressure on Pakistan's reserves and balance of payments.
Cholett said Washington was talking to Islamabad about the "perils" of a closer relationship with Beijing, but would not ask Pakistan to choose between the United States and China. Chollet is US Secretary of State Antony Blinken’s point person for South Asia, and is visiting Islamabad as part of a renewed push by the two countries to expand their cooperation beyond the limited scope of security and Afghanistan.
Relations between Islamabad and Washington had turned frosty over the war in Afghanistan, but there has been a thaw in recent months, with an increasing number of high-level exchanges.
Notwithstanding its public posturing against the United States, even the Pakistan Tehreek-e-Insaf (PTI) is making behind-the-scene efforts to repair ties with Washington. Former premier Imran Khan has not only abandoned his anti-US narrative, but his party has also reportedly shared with the visiting US State Department counselor its future plans for pulling Pakistan out of the economic abyss.
In another sign that PTI chief Imran Khan’s party would no longer seek to further antagonise the US, a visiting US delegation led by State Department counselor Derek Chollet met with PTI Senior Vice President Fawad Chaudhry on Thursday night.
These details emerged after Fawad revealed on Twitter that he indeed held a meeting with the visiting US officials, and discussed issues ranging from politics to human rights violations in Pakistan. In his tweet, Fawad stated that he had a “good meeting with the US ambassador and senior officials”.
https://twitter.com/fawadchaudhry/status/1626278358282641409
Since Khan's ouster in April 2022, this was the first publicly admitted meeting between the the PTI and a US diplomat. This came on the heels of Khan changing his narrative on the alleged "regime change conspiracy" that he used for months to bash the US and its officials, in order to drum up local political support for his party.
Sources present in the meeting revealed that the US officials asked the PTI to share its economic revival plan amid the ongoing financial crunch that had been accentuated by political volatility.
As the PTI tries to restore relations by assuring that it would abandon its anti-US narrative, Biden administration officials sought clarity from the PTI as to its stance on the understanding that the PDM government had reached with the International Monetary Fund (IMF).
Sources said that a meeting was also expected between the US diplomatic officials and the PTI’s economic team in the coming days to discuss matters further. Following that meeting with the economic team, the US officials could also pay a 'courtesy call' on PTI chief Imran Khan.
US Agency for International Development (USAID) counselor Clinton White, principal deputy assistant secretary for the Bureau of South and Central Asian Affairs at the State Department Elizabeth Horst, and US ambassador to Pakistan Donald Blome, were the other senior officials who attended the meeting with PTI's Fawad Chaudhry.
Pakistan, historically a close ally of Washington, has become increasingly close to China which has provided billions in loans and is Islamabad's largest single creditor. Pakistan is also facing a crippling economic crisis, with decades-high inflation and critically low foreign exchange reserves depleted by continued debt repayment obligations.
"We have been very clear about our concerns not just here in Pakistan, but elsewhere all around the world about Chinese debt, or debt owed to China," Chollet told journalists at the US Embassy in Islamabad after he met with Pakistani officials.
China and Chinese commercial banks held about 30% of Pakistan's total external debt totaling about $100 billion, according to a report by the International Monetary Fund released in September 2022.
Much of that debt has come under the China Pakistan Economic Corridor (CPEC), part of Beijing's Belt and Road Initiative. A proportion of that debt coming due in 2023 and 2024 has increased the pressure on Pakistan's reserves and balance of payments.
Cholett said Washington was talking to Islamabad about the "perils" of a closer relationship with Beijing, but would not ask Pakistan to choose between the United States and China. Chollet is US Secretary of State Antony Blinken’s point person for South Asia, and is visiting Islamabad as part of a renewed push by the two countries to expand their cooperation beyond the limited scope of security and Afghanistan.
Relations between Islamabad and Washington had turned frosty over the war in Afghanistan, but there has been a thaw in recent months, with an increasing number of high-level exchanges.
Anti-American rhetoric
Notwithstanding its public posturing against the United States, even the Pakistan Tehreek-e-Insaf (PTI) is making behind-the-scene efforts to repair ties with Washington. Former premier Imran Khan has not only abandoned his anti-US narrative, but his party has also reportedly shared with the visiting US State Department counselor its future plans for pulling Pakistan out of the economic abyss.
In another sign that PTI chief Imran Khan’s party would no longer seek to further antagonise the US, a visiting US delegation led by State Department counselor Derek Chollet met with PTI Senior Vice President Fawad Chaudhry on Thursday night.
These details emerged after Fawad revealed on Twitter that he indeed held a meeting with the visiting US officials, and discussed issues ranging from politics to human rights violations in Pakistan. In his tweet, Fawad stated that he had a “good meeting with the US ambassador and senior officials”.
https://twitter.com/fawadchaudhry/status/1626278358282641409
Since Khan's ouster in April 2022, this was the first publicly admitted meeting between the the PTI and a US diplomat. This came on the heels of Khan changing his narrative on the alleged "regime change conspiracy" that he used for months to bash the US and its officials, in order to drum up local political support for his party.
Sources present in the meeting revealed that the US officials asked the PTI to share its economic revival plan amid the ongoing financial crunch that had been accentuated by political volatility.
As the PTI tries to restore relations by assuring that it would abandon its anti-US narrative, Biden administration officials sought clarity from the PTI as to its stance on the understanding that the PDM government had reached with the International Monetary Fund (IMF).
Sources said that a meeting was also expected between the US diplomatic officials and the PTI’s economic team in the coming days to discuss matters further. Following that meeting with the economic team, the US officials could also pay a 'courtesy call' on PTI chief Imran Khan.
US Agency for International Development (USAID) counselor Clinton White, principal deputy assistant secretary for the Bureau of South and Central Asian Affairs at the State Department Elizabeth Horst, and US ambassador to Pakistan Donald Blome, were the other senior officials who attended the meeting with PTI's Fawad Chaudhry.