China Development Bank provides $1 billion loan in 2017 to shore up Pakistan’s foreign exchange reserves (Linked to Project ID#50486 and #54159)

On May 15, 2017, China Development Bank and the State Bank of Pakistan signed a $1 billion loan (term facility) agreement to shore up Pakistan’s foreign exchange reserves and improve macroeconomic conditions. The loan carried the following borrowing terms: an interest rate of 6-month LIBOR (1.425%) a 3.02% margin, no grace period, and a 3-year maturity length.

Additional details

1. In its 2016-2017 Yearbook, the Economic Affairs Division (EAD) of the Government of Pakistan identified total loan commitments from CDB as $1.7 billion. This aggregate figure refers to the $700 million CDB loan issued in 2016 (captured via Project ID#50483) and the $1 billion CDB loan issued in 2017 (captured via Project ID#54158). 2. Two other facility agreements were signed with Chinese banks in 2017 to help Pakistan with its balance of payments (as captured via Project ID #50486, #54159). 3. The all-in interest rate was calculated by adding 3.02% to the 6-month LIBOR rate in May 2017 (1.425%).

Number of official sources

9

Number of total sources

9