Islamabad: The International Monetary Fund (IMF) has said it has reached an agreement with Pakistan “on policies and reforms needed to complete the second review” of the USD 6 billion Extended Fund Facility (EFF).
The announcement was made by Ernesto Ramirez Rigo, Mission Chief for Pakistan, in a brief statement on Thursday, after a series of engagements with Adviser to the Prime Minister on Finance and Revenue Hafeez Shaikh, Governor of the State Bank of Pakistan Reza Baqir and Finance Secretary Naveed Kamran Baloch through video conference over the last two weeks, The Dawn reported.
“IMF staff and the Pakistani authorities have reached a staff-level agreement on policies and reforms needed to complete the second review of the authorities’ reform programme supported under the EFF,” the statement read.
The agreement is subject to approval by the IMF management and consideration by its executive board, which is expected in early April.
Completion of the review will enable disbursement of USD 450 million, it added.
Normally, details regarding reviews of IMF-supported programmes are made public after the reviews are approved by the fund’s executive board and staff reports are released.
The executive board meeting due for early March has now been postponed for a month until early April.
However, an official working with the IMF said that the two sides also acknowledged that there was tremendous pressure on the government over energy pricing and challenges faced by the industry.
Prime Minister Imran Khan has already announced recently that electricity and gas rates would remain unchanged during the remaining four months of the fiscal year.
Last June, the global financial body had considered the extension of the facility will help Pakistan to pay its external debts, recover from its fiscal deficit, keep foreign exchange reserves to the equivalent of three months of imports and curb further devaluation of the rupee.
Khan’s government, in its budget proposals for the next financial year, has already added IMF loans worth Rs 357 billion.
It was also decided that an IMF team will visit Islamabad every three months to review the economic indicators of the country.
According to analysts, financial assistance received from ‘friendly’ countries had not proven to be enough for the Pakistani government to keep its cash-strapped economy afloat.