The International Monetary Fund (IMF) is contemplating a new bailout package for Pakistan under its Extended Fund Facility (EFF), as revealed by Julie Kozak, the IMF’s director of communications.
During a press briefing in Washington, Kozak highlighted the considerable progress achieved during the recent IMF mission’s visit to Pakistan from May 13 to 23.
Kozak emphasized that the visit resulted in significant advancements toward reaching a staff-level agreement with Pakistan. “Pakistan can be supported under a new extended funding facility,” she stated, indicating the potential for ongoing financial support to strengthen the country’s economy.
The discussions between the IMF and Pakistan are ongoing, with virtual dialogues playing a crucial role in the negotiations. Kozak assured that the IMF remains dedicated to supporting Pakistan through these challenging times, highlighting the importance of the EFF in providing essential financial assistance.
According to officials from the Ministry of Finance, Pakistan is expected to receive a new three-year loan program valued between $6 and $8 billion from the IMF. Additionally, the upcoming budget for the new fiscal year is being prepared in accordance with the IMF’s recommendations and conditions.
On May 24, Pakistan and the IMF made notable strides in negotiations for a new loan program, despite the recent round of talks concluding without a staff-level agreement. The IMF’s 10-day visit to Pakistan, starting on May 13, laid a promising foundation for future discussions aimed at securing a comprehensive financial package, as stated at the visit’s conclusion.
The IMF delegation’s visit focused on critical areas such as human resource development, social security, and addressing the impacts of climate change. “Adequate progress has been made towards a staff-level agreement,” stated the IMF in their announcement. “Consultations will continue virtually to finalize the new program for Pakistan.”
The statement further mentioned that the reforms aim to achieve stable development in Pakistan. Islamabad is vigorously pursuing a new and larger loan program from the IMF, with Ministry of Finance officials targeting a bailout package between $6 and $8 billion.
The 10-day negotiations reviewed Pakistan’s request and discussed comprehensive economic policies and reforms designed to achieve stable growth, according to the IMF statement.
