Islamabad, September 24, 2024 – Pakistan’s Finance Minister, Senator Muhammad Aurangzeb, expressed confidence on Tuesday that the International Monetary Fund (IMF) will approve a 37-month, $7 billion Extended Fund Facility (EFF) for Pakistan during its board meeting on September 25, 2024. His optimism comes as Pakistan seeks much-needed financial assistance to stabilize its economy and ensure sustained reforms.
Speaking virtually at the “High Level Private Sector Dialogue – CPEC-II and the Region,” organized by the Pakistan Regional Economic Forum, Aurangzeb highlighted the country’s achievements in successfully concluding the nine-month Standby Agreement (SBA) with the IMF earlier. “We are very hopeful that the board will approve the 37-month, $7 billion programme,” the finance minister remarked during the session, which was attended by key economic stakeholders.
Aurangzeb emphasized that under the new IMF program, Pakistan remains committed to enacting structural reforms across critical sectors, including taxation, energy, state-owned enterprises, and privatization. He reaffirmed the government’s determination, stating, “We will stay on the course,” signaling that reform measures will continue to be a priority for the country.
He also expressed his gratitude to China for its unwavering support throughout Pakistan’s discussions with the IMF, recognizing China as a steadfast partner during this challenging economic period.
The finance minister pointed out that Pakistan’s economic outlook has improved steadily, with key indicators showing progress. He noted that the national currency has stabilized, foreign exchange reserves are holding steady with two months’ import cover, and inflation has significantly decelerated. Additionally, the policy rate and KIBOR (Karachi Interbank Offered Rate) have declined, benefiting Pakistan’s industrial sector and overall economic environment.
Aurangzeb highlighted the government’s recent decision to reject Treasury Bills (T-bills) and Pakistan Investment Bonds (PIBs), sending a clear message that it is no longer desperate for domestic borrowing. Instead, the government plans to borrow on its own terms if necessary, while encouraging investment inflows in the form of foreign direct investment (FDI) to spur economic growth.
Regarding the China-Pakistan Economic Corridor (CPEC), Aurangzeb confirmed that Phase-II is now in progress, focusing on monetizing the infrastructure established in Phase-I. While acknowledging that the momentum was temporarily missed, he emphasized that it is not too late to refocus efforts. Under Prime Minister Shehbaz Sharif’s leadership, Aurangzeb expressed optimism that CPEC would now prioritize investment attraction and cross-border development partnerships.
Aurangzeb urged Saudi Pak and Pak-China Development Financial Institutions (DFIs) to play a proactive role in facilitating cross-border investments, encouraging them to become catalysts for economic growth and bilateral collaboration.
