IMF Believes Pakistan Makes “Significant Progress”

Meanwhile, talks are open on new funding and a new reform package

Nathan Porter, head of the International Monetary Fund (IMF) mission to Pakistan, has returned after ten days in Islamabad where he discussed the country’s plans to establish a sustainable national economic program under the Extended Fund Facility (EFF).

“Building on the economic stabilization achieved through the completion of the 2023 Stand-By Arrangement, the IMF and the Pakistani authorities have made significant progress toward reaching a Staff Level Agreement (SLA) on comprehensive economic and political reforms that could be supported under the Extended Fund Facility (EFF),” Porter commented, explaining how the reform program aims to achieve in Pakistan economic stabilization and, at the same time, “strong, inclusive, and sustainable growth.”

The objectives to achieve this goal are defined as strengthening public finances, fairer taxation, sustainability of the energy system, and monetary and exchange rate policies that guarantee low inflation and improved public services through restructuring and privatization of state-owned enterprises.

According to Pakistan’s English-language Dawn newspaper, after a recent $3 billion loan that helped avoid a sovereign debt default, Pakistan is expected to request a new $6 billion loan under a new program, as well as additional funding under the Sustainable Development Trust Program.

The IMF explained that implementing reforms to stimulate the economy is more important than the size of the new loan package being negotiated.