ISLAMABAD: The International Monetary Fund has highlighted persistent corruption risks in Pakistan and urged rapid structural reforms. The findings appear in the Fund’s long-awaited Governance and Corruption Diagnostic Assessment. The government delayed the report’s publication since August. The IMF now requires its release before approving a $1.2 billion disbursement next month. The report warns that systemic weaknesses across major state institutions continue to enable corruption. It also demands immediate work on a 15-point agenda designed to strengthen transparency and fairness.
Report Predicts Strong Growth from Governance Reforms
The IMF estimates that Pakistan could significantly accelerate growth with swift reforms. The assessment says Pakistan could raise growth by 5 to 6.5 percent over five years through this package. It stresses that reforms must begin within the next three to six months. The report says improved governance and strong anti-corruption measures would generate substantial economic benefits. It identifies governance, anti-corruption, business regulation, and foreign trade regulation as key priority areas.
IMF Calls for Transparent SIFC Operations
The assessment urges an end to special treatment for influential public entities in government contracts. It demands full transparency within the Special Investment Facilitation Council. The IMF wants the government to publish the first SIFC annual report without delay. The report should detail all facilitated investments, including tax and policy concessions. It also seeks explicit protocols governing the SIFC’s wide-ranging authority. The IMF notes concerns about the council’s legal structure and immunity protections.
Assessment Highlights Sectoral Governance Failures
The IMF identifies major weaknesses in budgeting, fiscal reporting, procurement, and resource management. It reports that weak controls over corruption have damaged revenue collection and public trust. The assessment also lists problems in capital spending and oversight of state-owned enterprises. It highlights an inefficient judicial sector that struggles to enforce contracts or protect property rights. The report links these flaws to outdated laws, low capacity, and inconsistent integrity standards.
IMF Urges Overhaul of Public Procurement Rules
The Fund demands that procurement rules remove all preferences for state-owned enterprises. It wants mandatory e-procurement for all public transactions within 12 months. It also notes the country’s complex and opaque tax system, which weakens compliance and oversight. The IMF adds that low tax trust and frequent rule changes have reduced the tax-to-GDP ratio. It warns that budget implementation often diverges sharply from approved spending, reducing accountability. It stresses the need for greater parliamentary oversight of fiscal decisions.
