Islamabad – The International Monetary Fund (IMF) has confirmed that its Executive Board will consider Pakistan’s loan request under the Extended Fund Facility (EFF) on September 25, 2024. The agenda for the board meeting includes the “Pakistan – 2024 Article IV Consultation and Request for an Extended Arrangement under the Extended Fund Facility.”
This critical development follows the staff-level agreement reached between the IMF and Pakistan on July 12, 2024, for a 37-month EFF program. The agreement, worth around $7 billion (SDR 5,320 million), is aimed at stabilizing Pakistan’s struggling economy, which has been grappling with a myriad of fiscal challenges, including inflation and dwindling foreign exchange reserves.
The IMF’s Executive Board meeting is pivotal as it will determine whether Pakistan secures the much-needed financial assistance, contingent upon the fulfillment of financing assurances from Pakistan’s development and bilateral partners. These assurances are crucial for the successful implementation of the extended fund arrangement.
Julie Kozack, Director of the IMF’s Communications Department, confirmed during a press briefing on September 12 that Pakistan has secured the required financing assurances. She emphasized the importance of Pakistan’s policy measures, stating, “We are very happy that we can say now that the board meeting is scheduled for September 25.” Kozack also praised Pakistan’s economic reforms, which have led to signs of stabilization.
“Consistent policy measures have helped stabilize Pakistan’s economy, leading to resumed growth, disinflation, and an increase in international reserves,” Kozack noted during her briefing. These achievements are vital as Pakistan seeks to secure the IMF’s approval for the extended financial support program.
The EFF is designed to address Pakistan’s economic vulnerabilities, including fiscal imbalances and inflationary pressures, while promoting growth and enhancing international reserves. The program is expected to offer significant financial support over the 37-month period, providing relief to the country’s fragile economy.
This development is critical for Pakistan’s economic future, as the IMF loan will help the country stabilize its financial situation and implement much-needed reforms. Approval of the loan will likely lead to improved investor confidence, paving the way for further development and growth in the Pakistani economy.
The decision by the IMF’s Executive Board on September 25 will be a turning point for Pakistan’s fiscal outlook, and the country’s authorities are optimistic about the outcome.
