In an exclusive interview with AFP, Pakistan’s Minister for Finance and Revenue, Mr. Muhammad Aurangzeb, disclosed that Pakistan has commenced discussions with the International Monetary Fund (IMF) regarding a new multi-billion dollar loan agreement to bolster its economic reform initiatives.
As the South Asian nation approaches the conclusion of a nine-month, $3 billion loan program aimed at addressing a balance-of-payments crisis, Minister Aurangzeb revealed plans for negotiations on a new multi-year IMF loan program worth “billions” of dollars. He emphasized the improved market sentiment in the current fiscal year, attributing it to the country’s strengthened economic outlook.
While the IMF spokesperson acknowledged the ongoing focus on completing the existing Stand-by Agreement program, they confirmed the readiness of Fund staff to engage in initial discussions for a successor program, in response to the expressed interest of the new government.
Minister Aurangzeb’s visit to Washington coincides with the spring meetings hosted by the IMF and World Bank, where the agenda includes discussions on combatting climate change and assisting heavily indebted nations. These meetings serve as a platform for global economic stakeholders to address pressing issues and assess the state of the global economy.
Regarding Pakistan’s trading relationships with the United States and China, Minister Aurangzeb stressed the importance of maintaining critical ties with both nations. He highlighted the significance of the US as Pakistan’s largest trading partner and acknowledged China’s substantial investments, particularly through initiatives like the China-Pakistan Economic Corridor (CPEC).
In the context of the escalating trade war between the US and China, Minister Aurangzeb noted the opportunity for Pakistan to enhance its exports, drawing parallels with countries like Vietnam. He emphasized the need to scale up existing efforts to capitalize on this opportunity.
Furthermore, Pakistan is actively pursuing structural reforms, including a privatization drive to divest poorly-performing state-owned enterprises (SOEs). The privatization of Pakistan International Airlines (PIA) marks the initial step in this endeavor, with plans to finalize the process by the end of June. Minister Aurangzeb outlined a broader strategy to accelerate privatization efforts across various sectors in the coming years.
