Govt working on implementing IMF conditions, says PM – Markets

Prime Minister Shahbaz Sharif on Tuesday said the government is working on implementing the “requirements and conditions” of the International Monetary Fund (IMF) programme, remarks that come as the Executive Board approval for Pakistan’s $7-billion Extended Fund Facility remains pending.

“We hope that all conditions and requirements of the IMF will be met in time and our case will be approved by the [IMF Executive] board,” the PM said during the federal cabinet meeting.

“A new journey will begin. However, it should be kept in mind that this is Pakistan’s last programme with the IMF,” he maintained.

Back in July, the IMF staff and the Pakistani authorities reached a staff-level agreement on a 37-month Extended Fund Facility (EFF) of about $7 billion.

This agreement is still subject to approval by the IMF’s Executive Board and the timely confirmation of necessary financing assurances from Pakistan’s development and bilateral partners.

However, with those assurances pending, the IMF has not yet added Pakistan on its Executive Board schedule.

Board meetings scheduled till Sept 4: Pakistan not on IMF agenda yet

This comes as Pakistan works on securing a rollover of $12 billion in loans from key allies, including China, Saudi Arabia, and the United Arab Emirates (UAE). In addition, Pakistan has reportedly requested an additional $1.2 billion loan from Saudi Arabia to address a $2 billion financing gap.

Meanwhile, addressing at the federal cabinet meeting, PM Shehbaz said the burden of inflation is gradually reducing as he appreciated the role of his ministries.

Pakistan’s headline inflation clocked in at 9.6% on a year-on-year basis in August 2024, lower than the reading in July 2024 when it stood at 11.1%.

The inflation reading was back into single digits after a span of three years, showed Pakistan Bureau of Statistics (PBS) data. Back in October 2021, CPI inflation stood at 9.2%.

“However, there is a long way to go as we need to bring growth and stability into the economy,” the PM said.

The government priority is to create effective employment opportunities, he added.

PM said the government needs to accelerate efforts of rightsizing and downsizing. “Moreover, we need to shrink the circular debt in the power sector,” he said.

PM said the government remains committed to eradicate corruption and smuggling.