Global Rice News

Pakistan in Discussions with IMF for Potential Follow-Up Programme

Pakistan is currently in talks with the International Monetary Fund (IMF) regarding a potential follow-up programme after successfully completing a nine-month, $3 billion Stand-By Arrangement (SBA). According to IMF chief Kristalina Georgieva, Pakistan’s economy is performing better, with reserves now being built up. However, there are still important issues that need to be addressed.

Georgieva highlighted several areas that Pakistan needs to focus on, including expanding the tax base, ensuring contributions from the wealthier part of society, improving the direction of public spending, and creating a more transparent environment.

Last month, Pakistan and the IMF reached a staff-level agreement on the second and final review of the $3 billion stand-by arrangement. Once approved by the IMF’s board, the agreement will release approximately $1.1 billion to Pakistan.

Discussions are also underway for a longer-term bailout package and continued policy reforms to control deficits, increase reserves, and manage high levels of debt servicing.

Pakistan has decided to formally approach the IMF for a medium-term Extended Fund Facility (EFF) during the upcoming annual spring meetings of the IMF and World Bank. The size and duration of the bailout package will be determined by the IMF’s review mission, which is expected to hold talks in early May 2024.

Officials have stated that Pakistan plans to request an EFF with the possibility of augmenting it through climate finance. The country will present its argument to the IMF management, citing the severe consequences of climate degradation and the need for support from the international community and donor agencies.

Overall, Pakistan is committed to continuing its path of economic stability and growth, seeking further assistance from the IMF to address ongoing challenges and ensure a prosperous future.

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