The International Monetary Fund (IMF) announced in Islamabad that they had reached a staff-level agreement for a Stand-By Arrangement (SBA) worth USD 3 billion with Pakistan.
The main goal of the IMF accord is stabilising Pakistan’s economy in the wake of recent external shocks. In addition to offering a framework for finance from international and bilateral partners. It also aspires to assist the nation in attaining sustainable economic growth.
By improving domestic tax mobilisation and guaranteeing rigorous spending execution. The agreement will also permit higher social and development spending, meeting the demands of the Pakistani people. The IMF Executive Board will assess the staff-level agreement and decide whether to approve it by mid-July.
Under the direction of Nathan Porter, the IMF’s Mission Chief in Pakistan, the IMF staff held in-person and virtual sessions with the Pakistani government officials throughout the negotiation process. The main topic of discussion was the definition of the new funding engagement’s terms and conditions.
The programme was sponsored by the 2019 Extended Fund Facility (EFF) and terminated in June. It was built on the efforts undertaken by the Pakistani government. The impact of severe flooding in 2022, a rise in global commodity prices due to Russia’s involvement in Ukraine, and policy blunders that have led to slow economic development, excessive inflation, and falling reserves are just a few of the country’s economic issues.
The IMF accord has received praise from Prime Minister Shehbaz Sharif. He expressed optimism that it will help Pakistan achieve economic stability and sustainable growth. Implementing firm policies, such as fiscal restraint, a market-determined currency rate, energy sector reforms, climate resilience measures, and an improved business climate, are important for Pakistan.