The government has no plans to access the foreign currency held by commercial banks, according to statement of Finance Minister Ishaq Dar on Wednesday.
In a strongly worded clarification, Ishaq Dar claimed that some “vested elements” gave his statement a purposeful twist and launched a campaign suggesting that the government was thinking about accessing the foreign currency held with commercial banks, which “in fact is the property of the citizens.”
National foreign exchange reserves always include forex held with SBP and Commercial Banks. Recently I quoted the forex reserves figure based on this principle. Some vested elements who ruined this country’s economy in the past, gave it a deliberate twist and started a campaign
— Ishaq Dar (@MIshaqDar50) January 11, 2023
Dar stated that the State Bank of Pakistan and commercial banks’ holdings of foreign currency are always included in the calculation of national foreign exchange reserves, and he cited the reserves amounts in accordance with this rule.
It is important to note that the finance minister recently stated that Pakistan currently has $10 billion in foreign exchange reserves, not $4 billion, because the $6 billion held by commercial banks is also national property, a hint that the government is preparing to seize control of the privately held foreign exchange.
The SBP held $5.576 billion in foreign currency reserves as of December 30 according to the central bank’s most recent official report. The government has $11.422 billion in total liquid foreign currency reserves, including net reserves held by banks other than the SBP.
As a result of Pakistan returning more than $1 billion in loans from two international commercial banks, the central bank’s reserves reportedly fell to $4.5 billion. The updated reserves figure that will be issued tomorrow is expected to reflect the decrease in reserves (Thursday).
