UAE commits $10bn to boost Pakistan's economy

Pledge comes as new Prime Minister Shehbaz Sharif looks to turn around economy

President Sheikh Mohamed bin Zayed receives Pakistan's Prime Minister Shehbaz Sharif at Al Shati Palace. Sheikh Khaled bin Mohamed, Crown Prince of Abu Dhabi and Chairman of Abu Dhabi Executive Council, and Sheikh Hamdan bin Zayed, Ruler’s Representative of Al Dhafra Region, were present. All photos: Presidential Court

Sheikh Mohamed and Shehbaz Sharif discussed opportunities to enhance bilateral co-operation in a host of economic sectors

Mr Sharif affirmed his country's commitment to strengthening ties with the UAE

Sheikh Mohamed bin Hamad, Private Affairs Adviser in the Presidential Court, Sheikh Hamdan bin Mohamed and Mohamed Al Mazrouei, Minister of State for Defence Affairs attended the high-level meeting

The UAE and Pakistan enjoy long-standing relations dating back to the birth of the Emirates

Sheikh Mansour bin Zayed, Vice President and Deputy Prime Minister, receives Mr Sharif at Al Bateen Airport

Sheikh Mansour bin Zayed with Shehbaz Sharif

The UAE has pledged $10 billion to invest in promising economic sectors in Pakistan.

The announcement was made on Thursday following a meeting between President Sheikh Mohamed and Pakistan's Prime Minister Shehbaz Sharif in Abu Dhabi.

Shehbaz Sharif arrived for a working visit to the UAE earlier in the day.

During the meeting, Sheikh Mohamed and Mr Sharif discussed opportunities to enhance co-operation in sectors including the economy, trade and development, to "serve common interests and enhance both countries' vision of sustainable economic development and prosperity", state news agency Wam reported.

Mr Sharif affirmed his country's commitment to strengthening ties with the UAE and expanding co-operation in the economy, trade and investment, while also learning from the UAE's development.

In March, Pakistan’s newly elected parliament endorsed Mr Sharif as Prime Minister. Last month, the International Monetary Fund's executive board authorised $1.1 billion in funding for Pakistan, the final portion of a $3 billion arrangement Islamabad made with the multilateral lender last year.

Pakistan secured last year's IMF loan so it could avoid defaulting on its debt. To help secure the deal, Pakistan agreed to raise taxes and aggressively increase interest rates to tackle inflation.

The IMF noted several improvements made by Pakistan since the arrangement last year, including projected economic growth of 2 per cent for this fiscal year. It also expects inflation to return to the Pakistan central bank's target, with growth continuing to strengthen over the medium term.

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The UAE is home to more than one million Pakistani citizens, representing the second largest community of foreign residents.

The two countries enjoy long-standing relations dating back to the birth of the Emirates. Pakistan was among the first countries to recognise the UAE after it was founded in December 1971.

Pakistan also played an integral role in helping the UAE's aviation dreams to take flight. In 1985, Pakistan International Airlines offered support as Dubai sought to develop its own flagship airline, Emirates.

PIA provided assistance to Emirates and leased two aircraft to the fledgling company, which showed its gratitude by selecting Karachi as the destination for its maiden flight.