An International Monetary Fund mission and the Government of Pakistan have made significant progress toward reaching a staff-level agreement for an extended fund facility.
In a statement posted on its website on Friday, the IMF said the Fund has opened discussions with Pakistan on a new loan programme after Islamabad last month completed a short-term $3 billion programme, which helped stave off a sovereign debt default.
According to the end-of-mission IMF statement, the Pakistan authorities and the global lender have made “significant progress” towards reaching a staff-level agreement on a new loan programme.
The IMF mission, which concluded its visit on May 23, was in Islamabad to discuss Pakistan’s pursuit of a longer, larger Extended Fund Facility.
“Building on the economic stabilisation achieved through the successful completion of the 2023 Stand-by Arrangement, the IMF and the Pakistani authorities made significant progress toward reaching a Staff Level Agreement on a comprehensive economic policy and reform programme that can be supported under an Extended Fund Facility,” IMF Mission Chief to Pakistan Nathan Porter was quoted as saying in the statement.
“The authorities’ reform programme aims to move Pakistan from economic stabilisation to strong, inclusive, and resilient growth.
“To achieve this, the authorities plan to continue to strengthen public finances to reduce vulnerabilities by improving domestic revenue mobilisation through fairer taxation while scaling up spending for human capital, social protection, and climate resilience; secure energy sector viability, including reforms to reduce the high cost of energy; continue progress towards low and stable inflation by appropriate monetary and exchange rate policies.
