On Thursday, January 12, the United Arab Emirates came to an agreement with Pakistan to roll over a previous $2 billion loan and lend an additional $1 billion. This announcement emerged during Pakistani Prime Minister Muhammad Shehbaz Sharif’s visit to the UAE. According to Pakistani officials, the financial support from the UAE will help the nation overcome a growing economic crisis, particularly invoked by nationwide flooding, thus demonstrating the enduring diplomatic and economic relationship between the United Arab Emirates and Pakistan.
Amid the two-day visit, leadership from both nations expressed their support for one another and emphasized their ongoing diplomatic relationship. Written in Khaleej Times, “Sheikh Mohamed bin Zayed welcomed Prime Minister Sharif to Abu Dhabi and wished progress and prosperity for Pakistan. He praised the historical relations between the two nations and the valuable contributions made by the Pakistani community in the UAE.”
This is Prime Minister Sharif’s third time visiting the UAE since he first took office last April. The Pakistani Prime Minister’s Office highlighted the trip’s specific objectives: “the two leaders discussed the fraternal relations existing between Pakistan and the UAE; and explored ways and means to further strengthen these ties, especially in the fields of trade, investment and energy…Both sides agreed to deepen the investment cooperation, stimulate partnerships and enable investment integration opportunities between the two countries. They also expressed satisfaction over the pace of steady progress in bilateral relations.”
In addition to the loan agreement during the visit, leadership from both sides signed memoranda, showcasing fraternal bilateral growth. Written in Gulf News, “the two sides signed Memoranda of Understanding in the field of combating human trafficking, information exchange, and between the diplomatic academies of both countries.”
Former Pakistani Finance Minister Miftah Ismail expressed his support towards the UAE aid. Written in Al Jazeera, Ismail vocalized that “the decision to roll over the fund is ‘great news to Pakistan,’ and the announcement was seen by some…as a much-needed relief to the country which has seen its central bank’s foreign reserves deplete to less than $4.5bn, covering less than a month of imports.”
Emirati’s help comes at an urgent time for Pakistan, as other outlets for financial help are uncertain. Written in the Times of India, “as a ninth review by International Monetary Fund (IMF) to clear the release of the next $1.1 billion tranche of funds to Pakistan has been pending since September, the external financing is crucial for the country’s broken economy. Pakistan’s central bank foreign reserves fell to a critical level of $5.5 billion in the week ending Dec. 30, barely enough for three weeks of import.”
The future of Emirati-Pakistani relations are presumed to only grow. Cited in a press release from the Pakistani government: “Prime Minister Shehbaz Sharif invited His Highness Sheikh Mohamed Bin Zayed President of the UAE for a state visit to Pakistan to which he agreed. The dates will be decided through diplomatic channels.”