Pakistan Prime Minister Shehbaz Sharif discussed a new loan programme with IMF Managing Director Kristalina Georgieva on Sunday after two leaders met on the sidelines of the World Economic Forum in Riyadh.
This comes as the cash-strapped South Asian country is seeking a new, larger long-term Extended Fund Facility (EFF) agreement with the fund after a current $3 billion standby arrangement expires this month. “Both sides also discussed Pakistan entering into another IMF program to ensure that the gains made in the past year are consolidated and its economic growth trajectory remains positive,” Sharif’s office said.
أهلاً و سهلاً from Saudi Arabia!I am in #Riyadh for @wef #SpecialMeeting24 on Global Collaboration, Growth and Energy.Look forward to important discussions on pressing challenges of our times.— Shehbaz Sharif (@CMShehbaz) April 28, 2024
Ban on Twitter/X
On X, readers added context to the Pakistani PM’s post, noting that Shehbaz’s message came on the social media platform after it was banned in Pakistan. They wrote: “…the decision to impose a ban on Twitter/X in Pakistan was made in the interest of upholding national security, maintaining public order, and preserving the integrity of our nation.”
The IMF executive board will meet on Monday to discuss the approval of $1.1 billion of funding for Pakistan, which is the second and last tranche of the standby arrangement. Islamabad secured the arrangement last summer, helping it to avert a sovereign default. Pakistan’s Finance Minister, Muhammad Aurangzeb, has said Islamabad could secure a staff-level agreement on the new program by early July.
Islamabad says it is seeking a loan over at least three years to help achieve macroeconomic stability and execute long-overdue and painful structural reforms, though Aurangzeb has declined to detail what seize of programme the country seeks. Islamabad is yet to make a formal request, but the Fund and the government are already in discussions. If secured, it would be Pakistan’s 24th IMF bailout.
The $350 billion economy faces a chronic balance of payments crisis, with nearly $24 billion to repay in debt and interest over the next fiscal year – three-time more than its central bank’s foreign currency reserves. Pakistan’s finance ministry expects the economy to grow by 2.6% in the fiscal year ending in June, while average inflation for the year is projected to stand at 24%, down from 29.2% the previous fiscal year.
(With agency inpputs)
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