The International Finance Corporation (IFC) said it is partnering with a Pakistani bank to support the import of essential goods and equipment into the South Asian country to foster a sustainable recovery from the Covid-19 pandemic.
IFC is enhancing its trade facility to Bank Al Habib to enable it to support longer-term imports of capital goods including vital equipment, machinery, and tools under its Global Equipment Finance Facility.
Under the GEFF, IFC extends guarantees up to five years to selected partners for capital goods imports, with the focus on climate change.
The project will enable the bank to issue a letter of credit for up to 37 months for the import of critical capital goods into Pakistan, which has been constrained because of the pandemic.
“We are thankful to be a long-term partner of IFC’s global trade finance programme in Pakistan,” Al Habib’s chief executive Mansoor Ali Khan said.
“IFC’s support will enhance our existing trade limits to accommodate higher volumes of trade finance and extend our capacity to support the deliveries of vital capital goods to meet our clients’ import and business needs.”
Bank Al Habib is a long-term partner in IFC’s Global Trade Finance Programme, which supports trade in emerging markets.
IFC provides partial or full guarantees against underlying trade instruments and covering the payment risk of participating issuing banks.
“Trade finance is essential to enable the flow of goods and services in and out of the country, which is vital to support businesses and sustain livelihoods,” Khawaja Aftab Ahmed, IFC’s regional director for the Middle East, Pakistan and Afghanistan said.
- George Russell