International donors, led by the United States and Japan, pledged more than $5 billion Friday to stabilize Pakistan's troubled economy and fight the spread of terrorism in the Islamic nation and neighboring Afghanistan.
The United States and Japan started off the one-day conference by pledging $1 billion each. Saudi Arabia added $700 million and the EU $640 million. The total pledged was $5.28 billion, according to Pakistan's foreign minister.
"There is a desire to help Pakistan," Pakistani President Asif Ali Zardari said, but he added that the international community is still trying to grasp the implications of the problems his country faces.
"I still fear that the understanding of the danger that Pakistan faces still does not register fully in the minds of the world," he said. "If we lose, you lose. If we lose, the world loses."
Zardari had hoped for more
The donors said their contributions would be focused on improving the economic climate in Pakistan through infrastructure and other projects, and stressed that stability in Pakistan is key to averting the growth of terrorism throughout the region.
The total fell short of Zardari's hope of as much as $6 billion in pledges. The conference's Japanese hosts had said they expected a figure closer to $4 billion.
"We have demonstrated our clear determination to face the issues," said Japanese Foreign Minister Hirofumi Nakasone.
Both Japan and the United States will make their contributions over the next two years, and neither represented a dramatic change in their current pattern of donations. Saudi Arabia's pledge would also be disbursed over the next two years, and the EU's over the next four years.
The United States said in a statement it would contribute $1 billion as a "down payment" on aid it has already announced.
Pakistan Foreign Minister Shah Mehmood Qureshi called the conference a success.
"I am more than satisfied with the successful conclusion of today's conference," he said. "In fact, I am delighted."
Afghanistan also on the agenda
Though focused on Pakistan, the conference also discussed related issues in neighboring Afghanistan.
"Without stability in Pakistan, there is no stability in Afghanistan," Japanese Prime Minister Taro Aso said in a speech opening the conference. "Stability in border areas is a key and I want to stress that the international community supports comprehensive strategies by the two nations."
The conference, supported by the World Bank, was attended by 31 countries and 18 international organizations.
Japan provided Pakistan with 48 billion yen ($480 million) in development assistance in 2008.
The U.S. contribution will go toward Washington's previously announced plans to give Pakistan $1.5 billion in aid each year for the next five years. Separately, a $7.6 billion bailout has been granted by the International Monetary Fund to avert the country's most recent balance-of-payments crisis.
Islamabad asked to reduce deficit
As part of the IMF deal, Pakistan has been asked to reduce its fiscal deficit and to tighten its monetary policy.
Pakistan's leaders have said they do not want the international community to "micromanage" its economy, but the central bank forecast this month that economic growth for the year through June will slump to between 2.5 percent and 3.5 percent, far below the 5.5 percent the government has projected — and too low to create enough jobs for its fast-growing population of about 170 million people.
In response, the government has had to slash its development budget but is resisting calls to tax the narrow landowning elite that dominates its politics. Industry is also hampered by severe power shortages that are not expected to ease until next year at the earliest.