Islamabad
In a major relief to cash-strapped Pakistan, the government and the IMF have reached a long-awaited staff-level agreement to inject USD 3 billion into the ailing economy after months-long negotiations that pushed the country to the brink of default.
Pakistan and the Washington-based global lender reached an agreement on Thursday to support the authorities’ immediate efforts to stabilise the economy from external shocks.
Pakistan’s economy has been in a free fall mode for the last many years, bringing untold pressure on the poor masses in the form of unchecked inflation, making it almost impossible for a vast number of people to make ends meet.
I am pleased to announce that the IMF team has reached a staff-level agreement with the Pakistani authorities on a nine-month Stand-by Arrangement (SBA) in the amount of SDR 2,250 million (about USD 3 billion or 111 per cent of Pakistan’s IMF quota), Nathan Porter, the International Monetary Fund’s Mission Chief to Pakistan, said in a statement on Thursday.
The new SBA builds on the authorities’ efforts under Pakistan’s 2019 EFF-supported programme which expires at the end-June. This agreement is subject to approval by the IMF’s Executive Board, which is expected to consider this request by mid-July, the statement added.
Finance Minister Ishaq Dar shared the IMF’s press release on Twitter accompanied by a message: God may be praised, Planning Minister Ahsan Iqbal called it good news and urged them to use the opportunity to turn around the country.
The USD 3 billion funding, spread over nine months, is higher than expected for Pakistan. The country was awaiting the release of the remaining USD 2.5 billion from a USD 6.5 billion bailout package agreed in 2019, which expires on Friday.
