Says next step with Pakistan tied to external financing assurances
A long-awaited loan agreement between Pakistan and the International Monetary Fund will be signed once a few remaining points, including a proposed fuel pricing scheme, are settled, an IMF official confirmed on Friday.
The latest issue is a plan, announced by Prime Minister Shehbaz Sharif last week, to charge affluent consumers more for fuel, with the money raised used to subsidise prices for the poor, who have been hit hard by inflation, which in February was at its highest in 50 years.
Petroleum Minister Musadik Malik told media on Thursday that his ministry had been given six weeks to work out the pricing plan.
But the IMF’s resident representative in Pakistan, Esther Perez Ruiz, said the government did not consult the fund about the fuel pricing scheme. Ruiz, in a message to Reuters, confirmed a media report that a staff-level agreement would be signed once a few remaining points, including the fuel scheme, were settled.
She added that the fund would ask the government for more details about the fuel proposal, including how it would be implemented and what protection would be put in place to prevent abuse.
Meanwhile, Julie Kozack, director of communications at the IMF, said in a press briefing yesterday that “timely financial assistance from external partners will be critical to support the authorities’ policy efforts and ensure the successful completion of the review”.
