Pakistan and IMF Reach Staff-Level Agreement on $2 Billion Loan

Pakistan and the International Monetary Fund (IMF) have successfully reached a staff-level agreement for a $2 billion loan. Following successful negotiations, both parties have agreed on a staff-level deal for the first review of the program.

The IMF team, led by Nathan Porter, worked closely with Pakistani authorities to finalize the agreement. However, the final approval will come from the IMF’s board. If approved, Pakistan will receive $1 billion under the Extended Fund Facility (EFF). Additionally, Pakistan will receive $1.3 billion under a 28-month arrangement to address climate change and natural disasters, bringing the total loan amount under this program to $2 billion. The arrangement is set for 37 months.

According to the IMF, inflation in Pakistan is at its lowest level since 2015. Over the past 18 months, Pakistan has made progress in restoring macroeconomic stability despite various challenges. The IMF also stated that Pakistan’s economic situation has improved, with the gradual increase in economic activities expected. However, Pakistan continues to face risks related to the environment.

The IMF expressed its commitment to supporting Pakistan’s efforts to implement reforms and promote social protection. The fund will assist Pakistan in mitigating the impacts of natural disasters and enhancing investment to address climate change. Furthermore, the IMF will support Pakistan’s reforms in the energy sector.

Following the agreement with the IMF, Finance Minister Mohammad Aurangzeb spoke to Geo News, expressing the government’s determination to put the country on a path of productive and export-oriented growth. He emphasized that Pakistan is committed to implementing reforms in areas such as taxation, energy, and public institutions.