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Chinese investors ask 'iron brother' Pakistan to relocate funds as default risk gets real

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Chinese investors ask 'iron brother' Pakistan to relocate funds as default risk gets real

Islamabad, May 7 (IANS) Pakistan’s economic woes continue to dampen its credibility among global investors as now its closest ally, friend, and ‘iron brother’ China, too, has put forward a demand, which has forced emergency consultations in Islamabad.

Amid increased fears of a complete meltdown of the Pakistani economy leading to default, Chinese investors have told Islamabad to relocate funds in off-shore bank accounts to service debts sustained for establishing energy plants under the China-Pakistan Economic Corridor (CPEC).

Moreover, Chinese investors have also insisted that Islamabad should clear $125 million in dividends it owes to Chinese firms functioning in Pakistan.

The Chinese demand has forced emergency huddles in relevant quarters of the Pakistan government, who are now contemplating and consulting the kind of response that should be given.

Sources aware of the development say that Pakistan has not accepted the demand till now and is being cautious over its potential reaction.

“Islamabad is also cautious about potential reactions from the International Monetary Fund (IMF) to any new concessions to Beijing,” said the government source.

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Pakistan’s Finance Minister Muhammad Aurangzeb has urged focused caution in accepting any Chinese demand.

“The Finance Minister has cautioned the Cabinet Ministers in accepting any Chinese demand at the moment due to sensitivities surrounding the upcoming bailout programme talks with the IMF,” said a senior official.

The government maintains that Islamabad has never defaulted on Chinese energy debt repayments, a reasoning that may be used to respond to Chinese investors’ demand.

Pakistan is also expected to put forward its response during the Joint Working Group on Energy meeting in Beijing next week.

One more reason for the latest Chinese demand, sources reveal, is that Chinese investors are finding it difficult to obtain new loans due to financial troubles in Pakistan.

“To address banks’ concerns, investors are now seeking to place funds in off-shore accounts to demonstrate their revenue streams,” the official, who requested anonymity, said.

Chinese investments in energy projects in Pakistan are estimated at a value of at least $21 billion, while the Chinese debt for energy projects stands at around $15 billion.

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China has established energy projects in Pakistan with an understanding of 75 per cent debt and 25 per cent equity. Now, it has to pay annual payments of about $2.4 billion in debts and dividends.

On the other hand, Pakistan’s thin foreign exchange reserves — $9 billion, currently — block the central bank’s capacity to allow outflow of funding.

Most of these reserves were acquired through foreign loans and purchasing of around $5.5 billion from the open market.

Islamabad is also not ready to cater to any demand from China that may have any negative impact on the upcoming Pakistan visit of an IMF team.

However, ignoring the Chinese demand is also something that the current government cannot afford to do.

–IANS

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Hamas chief Ismail Haniyeh assassinated in Tehran

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Hamas chief Ismail Haniyeh assassinated in Tehran

Hamas chief Ismail Haniyeh assassinated in Tehran

Tel Aviv, July 31 (IANS) The political head of Hamas, Ismail Haniyeh, has been assassinated in Tehran, Iran’s Islamic Revolutionary Guard Corps (IRGC) said in a statement on Wednesday.

Haniyeh was killed alongside one of his bodyguards at his residence in the Iranian capital while he was in the town to attend Iran’s President Masoud Pezeshkian’s swearing-in ceremony on Tuesday.

There are no further details on the killing from the IRGC.

As per several television analysts in Iran, the blame has been put on Israel.

Reacting to the news, Israel War Room posted a video on X showing Haniyeh celebrating the October 7 attack on Israeli citizens.

“This was Hamas chief Haniyeh’s reaction to the Hamas massacre on October 7. He’s not celebrating anymore,” it captioned the video.

Haniyeh was the face of Hamas and was active in several peace negotiations.

–IANS

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Venezuelan President blames opponent for post-election violence

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Venezuelan President blames opponent for post-election violence

Venezuelan President blames opponent for post-election violence

Caracas, July 31 (IANS) Venezuelan President Nicolas Maduro has blamed the opposition’s presidential candidate, Edmundo Gonzalez Urrutia, for the post-election violence unleashed across the nation.

“I hold you responsible, Mr. Gonzalez Urrutia, for everything that is happening in Venezuela, for the criminal violence, for the criminals, for the injured, for the dead, for the destruction,” the president said in a message broadcast to the nation during a joint meeting of the Council of State and the Defense Council on Tuesday.

The President also announced the creation of a fund to aid victims of the violence, Xinhua news agency reported.

Up to 749 people have been arrested for participating in violent riots following Sunday’s presidential election, Attorney General Tarek William Saab said Tuesday.

Venezuela’s National Electoral Council on Monday declared Maduro the winner of the election, paving the way for his third six-year term, from 2025 to 2031.

–IANS

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4.7-magnitude earthquake jolts Tokyo area: JMA

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4.7-magnitude earthquake jolts Tokyo area: JMA

4.7-magnitude earthquake jolts Tokyo area: JMA

Tokyo, July 31 (IANS) An earthquake with a preliminary magnitude of 4.7 on early Wednesday rocked the Tokyo metropolitan area, the country’s weather agency said.

The temblor occurred at 01:47 a.m. local time, measuring 3 on the Japanese seismic intensity scale of 7 in areas in Tokyo, Kanagawa and Chiba Prefecture, said the Japan Meteorological Agency (JMA).

At a depth of 120 km, the epicentre was located in Tokyo’s 23 wards at a latitude of 35.7 degrees north and a longitude of 139.6 degrees east, Xinhua news agency reported.

The tremors were felt strongly in central Tokyo, with no tsunami warnings issued.

There have been no reports of damage or casualties due to the temblor.

–IANS

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Iran, Egypt hope for speedy resumption of ties

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Iran, Egypt hope for speedy resumption of ties

Iran, Egypt hope for speedy resumption of ties

Tehran, July 31 (IANS) Iran and Egypt have expressed hope that bilateral ties will be resumed as soon as possible.

In a meeting in Tehran on Tuesday, Iran’s President Masoud Pezeshkian and Egypt’s Foreign Minister Badr Abdelatty exchanged views on bilateral relations, Xinhua news agency reported, citing a statement published on the website of the Iranian president’s office.

Pezeshkian said Iran and Egypt were two “brotherly” countries whose peoples had a “heartfelt” interest in one another, pointing to the two countries’ “age-old, brilliant and glorious” civilizational backgrounds.

He hoped that the problems hindering the normalisation of bilateral ties would be completely resolved as soon as possible.

Pezeshkian said Iran and Egypt could help resolve many of the region’s problems, noting Iran is ready to cooperate and exchange experiences, capabilities, and bilateral capacities with Egypt.

The Egyptian foreign minister, who was in Iran to attend Pezeshkian’s swearing-in ceremony held on Tuesday, said the two countries adopted close positions on issues such as non-interference in other states’ affairs, protecting the multilateral international system and defending humanitarian rights.

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He added the normalisation of bilateral ties was continuing on its path, hoping that the two countries would manage to officially begin cooperation with each other as soon as possible to safeguard mutual interests.

Iran and Egypt severed diplomatic relations in 1980. In recent months, both countries have expressed willingness to mend ties by settling differences on certain issues.

In November 2023, late Iranian President Ebrahim Raisi and current Egyptian President Abdel-Fattah al-Sisi held their first meeting in Riyadh on the sidelines of the Joint Arab-Islamic Extraordinary Summit to end the Gaza conflict.

–IANS

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UK: Violent mob clashes with cops outside mosque in Southport

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UK: Violent mob clashes with cops outside mosque in Southport

UK: Violent mob clashes with cops outside mosque in Southport

London, July 31 (IANS) Violent mob clashed with police outside a mosque in northwest England’s Southport near the scene of a horror stabbing that left three dead.

Merseyside Police said that the English Defence League is believed to be behind the violent protests.

Speculation about the alleged attacker’s identity circulated online, fuelling the tension that already existed after Monday’s horrific knife attack, The Sun reported.

Protesters threw bricks at the mosque, set fire to cars and wheelie bins and caused damage to a local convenience store, police said.

At least 22 police officers, responding to the situation, were injured and 11 were hospitalised after clashes.

–IANS

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