IMF Is Ready to Give New Bailout Program to Pakistan

The International Monetary Fund (IMF) is ready to offer a new bailout program to Pakistan to help alleviate its fiscal and external stability challenges. Pakistan has expressed interest in a successor IMF-supported program to resolve the country’s fiscal and external stability challenges and lay the foundation for inclusive growth and the Fund stands ready to engage in program discussions in the coming months. This was stated by Julie Kozack, Director of the Communications Department at IMF while addressing a press briefing. She further stated that on March 19, IMF staff and the Pakistani authorities reached a staff-level agreement on the second and final review under Pakistan’s Stand-By Arrangement (SBA).  This is subject to approval by the IMF’s Executive Board. Upon approval by the Board, Pakistan will have access to around $1.1 billion, and that would bring total disbursements under the SBA to about $3 billion.  We do expect the board meeting to take place in late April. The agreement recognizes the strong, the staff level agreement, recognizes the strong program implementation by the State bank of Pakistan and the caretaker government in recent months, as well as the new government’s intentions for ongoing policy and reform efforts to move Pakistan from stabilization to a strong and sustainable recovery. The Fund official; further stated that Pakistan’s economic and financial improvement has improved in the months since the first review was completed.  “Growth and confidence are continuing to recover.  And we will be releasing in the next weeks as part of our World Economic Outlook, our latest growth forecasts for Pakistan,” she added. Kozack stated that “the authorities have expressed interest in a successor IMF-supported program with the aim of resolving Pakistan’s fiscal and external stability challenges and laying the foundation for inclusive growth.  And, of course, we stand ready to engage in program discussions in the coming months”.