ISLAMABAD: Pakistan is set to commence discussions with the International Monetary Fund (IMF) for the second review of the stand-by agreement during the current week, as confirmed by the newly-appointed Finance Minister, Muhammad Aurangzeb.
Aurangzeb, who previously served as the CEO of one of Pakistan’s largest banks, assumed office as finance minister on Monday following his swearing-in ceremony. He emphasized that the year 2024 is anticipated to pose significant economic challenges for Pakistan.
The successful completion of the second review is expected to unlock the final tranche of the Stand-By Arrangement (SBA), amounting to $1.1 billion.
However, there are speculations suggesting that the discussions with the IMF might encompass more than just the final review of the SBA, with Islamabad potentially seeking a new medium-term bailout.
The IMF has conveyed its optimism regarding negotiations with the new government in Pakistan. IMF spokesperson Julie Kozack recently stated, “We look forward to engaging with the new government to complete the second review under the current stand-by arrangement and, should the government request, support the formulation of a new medium-term economic program.”
Kozack highlighted the interim government’s efforts in maintaining economic stability by adhering strictly to fiscal targets and safeguarding the social safety net. She emphasized the importance of a tight monetary policy stance to control inflation and bolster foreign exchange reserves.
“We look forward to working with the new government on policies to ensure macroeconomic stability and prosperity for all of Pakistan’s citizens,” Kozack concluded.
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