The International Monetary Fund’s Executive Board is slated to review Pakistan’s first assessment on January 11 next year, which could unlock $700 million under the standby arrangement (SBA), according to a Bloomberg report citing the lender’s spokesperson on Friday.
Pakistan previously reached a staff-level agreement with the IMF under the $3 billion SBA and is awaiting board approval to access a second tranche.
Recent reports noted that Pakistan’s initial review for approval was not listed in the IMF’s Executive Board meeting agenda for the December 1-15 schedule. This delay is attributed to the IMF team’s efforts to secure reconfirmation from multilateral and bilateral creditors, essential for meeting the fiscal year’s financing requirements of $24.9 billion.
Discussions among policymakers suggest the possibility of IMF talks for the second review occurring after the general elections and the new government’s takeover. Initially slated to commence discussions on the second review from February 3, 2024, this might now take place in late February or early March 2024 if elections are scheduled for February 8, 2024.
The current SBA program is set to expire on April 14, 2024.
IMF Executive Director Bahador Bijani highlighted an overall economic improvement, commending Pakistani authorities for their efforts during an event in Washington, emphasizing Pakistan’s significance regionally and globally.
Nathan Porter, IMF Mission Chief to Pakistan, expressed contentment with the recent staff-level agreement, praising the current government’s actions and policies as indicative of their commitment to stabilizing the country.
Pakistan faces challenges like rapid inflation in Asia, upcoming dollar-denominated debt of about $1 billion next year, and scheduled February elections. Interim Finance Minister Shamshad Akhtar indicated that despite the staff-level deal, the country might seek an additional IMF loan due to the economy’s fragility.
