Pakistan is currently engaged in discussions with the International Monetary Fund (IMF) regarding a potential follow-up program to its nine-month, $3 billion stand-by arrangement, according to IMF chief Kristalina Georgieva on Thursday. Speaking at an event hosted by the Atlantic Council think tank, Georgieva noted Pakistan’s progress in completing its existing IMF program and the improved performance of its economy, including the accumulation of reserves.
Georgieva emphasized Pakistan’s commitment to continuing on this path and seeking further assistance from the IMF for a follow-up program. However, she highlighted key issues that Pakistan still needs to address, such as expanding the tax base, ensuring contributions from the affluent section of society, directing public spending effectively, and enhancing transparency in the economic environment.
Last month, Pakistan and the IMF reached a staff-level agreement on the second and final review of the $3 billion stand-by arrangement. Upon approval by the IMF’s board, approximately $1.1 billion will be disbursed to Pakistan. The board is anticipated to review the matter in late April, although a specific date has not been confirmed yet, according to a spokesperson.
Both Pakistan and the IMF are also discussing the possibility of negotiating a longer-term bailout and continuing with necessary policy reforms to manage deficits, bolster reserves, and address the challenge of soaring debt servicing.
