Pakistan finally included in IMF Board agenda
On Thursday, the International Monetary Fund (IMF) announced that its board will meet on September 25 to review the $7 billion Extended Fund Facility (EFF) arrangement for Pakistan.
Pakistan had anticipated finalizing a deal with the IMF in August, following the approval of the 37-month program in July.
Pakistan increased its tax revenue target by 40% and raised energy prices to meet the IMF’s conditions. The country also concluded its previous $3 billion loan program in April and recently received a credit rating upgrade from both Moody’s and Fitch Ratings.
IMF spokesperson Julie Kozack confirmed that a staff-level agreement on the EFF was reached with Pakistan in July.
She stated, “We are pleased to confirm that the board meeting is set for September 25, following Pakistan’s receipt of necessary financing assurances from its development partners. The new EFF arrangement follows the successful execution of the 2023 nine-month standby arrangement.”
Kozack noted that consistent policy implementation has increased economic stability in Pakistan, marked by renewed growth, substantial disinflation, and a significant boost in international reserves.
When asked if Pakistan had received the required assurances, she confirmed, “Yes.”
In response, Finance Minister Muhammad Aurangzeb expressed his appreciation for the efforts of all parties involved in the negotiations. He stated, “Thanks to God, all issues with the IMF have been resolved amicably.”
Aurangzeb extended his thanks to Prime Minister Shehbaz Sharif’s team, IMF negotiators, and relevant institutions, adding that “These matters will be finalized in the IMF board meeting this month. The economy is progressing towards growth following stabilization.”
The finance minister also highlighted that the reduction in the policy rate would foster increased investment and business activity, creating job opportunities and providing relief from inflation.
Earlier, State Bank of Pakistan (SBP) Governor Jameel Ahmad revealed that the country had secured over $2 billion in financing from sources other than the IMF. He described this external financing as the “final hurdle” for the loan.
Ahmad stated at an analyst briefing, “All assurances and external financing have been arranged, and I do not foresee any further obstacles in presenting our case to the board.”
Prime Minister Shehbaz Sharif, speaking at a federal cabinet meeting, said that negotiations with the IMF were “progressing positively,” while expressing gratitude to supportive nations. He emphasized that there is a need for Pakistan to become self-sufficient and reduce its reliance on loans.
