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IMF gives green light for $1.1 billion loan to Pakistan

10:52 PM | 29 Apr, 2024
IMF gives green light for $1.1 billion loan to Pakistan
Source: IMF website

The Executive Board of the International Monetary Fund (IMF) has given the green light for a $1.1 billion loan to Pakistan, marking the final installment of a $3 billion Stand-by Arrangement (SBA).

In an official statement released on its website, the IMF stated, "The Executive Board of the International Monetary Fund (IMF) has completed the second and final review of Pakistan’s economic reform program supported by the IMF’s Stand-By Arrangement (SBA). This decision paves the way for an immediate disbursement of SDR 828 million (approximately $1.1 billion), bringing the total disbursements under the arrangement to SDR 2.250 billion (approximately $3 billion)."

Antoinette Sayeh, Deputy Managing Director and Chair, highlighted the progress Pakistan has made in restoring economic stability under the 2023 Stand-By Arrangement (SBA). She emphasized the importance of capitalizing on this stability through continued adherence to sound macroeconomic policies and structural reforms to foster stronger, inclusive, and sustainable growth. Sayeh stressed the need for ongoing external support.

The IMF underscored the appropriateness of the State Bank of Pakistan's tight monetary policy stance until inflation returns to more moderate levels. It emphasized the importance of further enhancements in the functioning of the foreign exchange market and a market-determined exchange rate to bolster resilience against external shocks and attract financing for growth. Additionally, it called for sustained efforts to rebuild foreign exchange reserves and address undercapitalized financial institutions to ensure financial stability.

The loan, which is anticipated to be disbursed this week, represents the final tranche of a $3 billion Stand-By Arrangement (SBA) secured by Pakistan last summer to avert a sovereign default. This decision follows discussions during the IMF Executive Board meeting in Washington.

This development comes on the heels of Prime Minister Shehbaz Sharif's meeting with IMF Managing Director Kristalina Georgieva in Riyadh, where they discussed Pakistan's potential entry into another IMF program. Pakistan is seeking a new long-term Extended Fund Facility (EFF) after the current $3 billion Stand-By Arrangement (SBA) expires this month.

The country has formally requested an EFF bailout package ranging between $6 to $8 billion, with the possibility of augmentation through climate financing. However, the specifics regarding size and timeframe will be determined in May 2024 after consensus is reached on the major aspects of the program. Pakistan has expressed interest in dispatching an IMF review mission in May 2024 to finalize details of the three-year EFF program.

Finance Minister Aurangzeb has indicated that Islamabad aims to secure a staff-level agreement on the new program by early July. The loan is intended to support macroeconomic stability and implement overdue structural reforms, although specifics on the program size have not been disclosed.

If successful, this would mark Pakistan's 24th IMF bailout. The $350 billion economy faces a persistent balance of payments crisis, with nearly $24 billion in debt and interest repayments due in the next fiscal year—three times more than its central bank's foreign currency reserves. The Ministry of Finance expects the economy to grow by 2.6% in the fiscal year ending in June, with average inflation projected at 24%, down from 29.2% in the previous fiscal year.

Daily Pakistan Global Web Desk

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US Dollar, Euro, Pound, Dirham, Riyal Rate in Pakistan Today Open Market Rates - 15 July 2024

Pakistani rupee rates against US Dollar and other currencies on July 15, 2024 (Monday) in open market.

USD to PKR Rate Today

US dollar was being quoted at 279.8 for buying and 280.75 for selling. Euro's buying rate moves up to 301.25 and selling rate is 303.15.

British Pound rate is 355.15 for buying, and 358.65 for selling. UAE Dirham AED was at 76.5 and Saudi Riyal lowered to 73.65.

Currency Rates Today

Source: Forex Association of Pakistan. (last update 08:00 AM)       
Currency Symbol Buying Selling
US Dollar USD 279.8 280.75
Euro EUR 301.25 303.15
UK Pound Sterling GBP 355.15 358.65
U.A.E Dirham AED 76.5 77.25
Saudi Riyal SAR 73.65 74.37
Australian Dollar AUD 184.55 186.35
Bahrain Dinar BHD 741 749
Canadian Dollar CAD 203.75 205.75
China Yuan CNY 38.35 38.75
Danish Krone DKK 40.05 40.45
Hong Kong Dollar HKD 35.7 36.05
Indian Rupee INR 3.33 3.43
Japanese Yen JPY 1.91 1.99
Kuwaiti Dinar KWD 908.25 917.35
Malaysian Ringgit MYR 58.95 59.75
New Zealand Dollar NZD 169.24 171.24
Norwegians Krone NOK 26.04 26.34
Omani Riyal OMR 722.87 730.89
Qatari Riyal QAR 76.39 77.09
Singapore Dollar SGD 202 204
Swedish Korona SEK 26.5 26.8
Swiss Franc CHF 309.15 311.65
Thai Bhat THB 7.5 7.65



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