Islamabad, Mar 20 (EFE).- Pakistan and the International Monetary Fund (IMF) reached a staff-level agreement under which, if approved, the debt-ridden South Asian economy will get a disbursement of $1.1 billion, the global lender said Wednesday.
A vendor waits for customers at a grocery shop in Peshawar, Pakistan, 08 June 2023. EFE-EPA FILE/BILAWAL ARBAB
Last week, the Pakistani finance ministry had said that a team from the IMF was visiting Islamabad, for the second and final review of a stand-by arrangement (SBA) with talks scheduled to be held from Mar. 14 to 18.
The initial four-day negotiations had extended to five days in the capital.
“The IMF team has reached a staff-level agreement with the Pakistani authorities on the second and final review of Pakistan’s stabilization program,” the IMF said in a statement on Wednesday.
“This agreement is subject to approval by the IMF’s executive board, upon which the remaining access under the SBA, US$1.1 billion will become available,” it added.
Pakistan’s economic and financial position has improved in the months since the first review, according to the IMF statement.
“However, growth is expected to be modest this year and inflation remains well above target,” it said.
Before the IMF team’s visit, Finance Minister Muhammad Aurangzeb had said that Islamabad would seek another long-term bailout but did not reveal the size of the additional loan.
The IMF said that the Pakistani authorities also expressed interest in a successor medium-term Fund-supported program with the aim of permanently resolving Pakistan’s fiscal and external sustainability weaknesses, strengthening its economic recovery, and laying the foundations for strong, sustainable, and inclusive growth.
It added that discussions regarding the program were expected to start in the coming months.
The government of newly elected Prime Minister Shehbaz Sharif has taken the charge at a time when the country is facing an alarming debt crisis, depleting foreign currency reserves and rising inflation. EFE
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