ISLAMABAD – Formal negotiations between Pakistan and the International Monetary Fund (IMF) are set to begin today as a visiting IMF staff mission starts discussions with the government on the fourth review of the $7 billion Extended Fund Facility (EFF) and the third review of the Resilience and Sustainability Facility (RSF).
The IMF mission, led by Iva Petrova, is expected to remain in Pakistan for nearly two weeks, with talks continuing until the first week of October.
During the negotiations, Pakistani officials will brief the IMF on the Sovereign Wealth Fund, measures to reduce circular debt, the current account position, the primary surplus, foreign exchange reserves and the exchange rate.
The government is also expected to explain why the sugar sector has not been deregulated, while discussions will cover progress under the ongoing economic reform programme.
Talks between the IMF and the Federal Board of Revenue (FBR) will focus on broadening the tax base and advancing tax reforms. The government will also discuss measures aimed at improving tax and non-tax revenue collection by the provinces.
The Ministry of Energy is expected to provide a briefing on circular debt and reforms in the energy sector.
Officials from the National Accountability Bureau (NAB) and the Federal Investigation Agency (FIA) will brief the IMF on measures related to anti-money laundering and efforts to prevent terrorist financing.
Pakistan is currently implementing a 37-month IMF programme focused on fiscal discipline, structural reforms and measures intended to support long-term economic growth.
If the reviews are completed successfully, Pakistan is expected to become eligible for about $1 billion under the EFF, equivalent to 760 million Special Drawing Rights, along with another $200 million under the RSF. The combined amount of around $1.2 billion could be disbursed by the end of November or early December.
