ISLAMABAD: Pakistan will instantly receive $1,177 million (SDR 894 million) from the International Monetary Fund, bringing total disbursements under the program to about $4.2 billion, as it reached agreement on the Combined Seventh and Eight Reviews for Pakistan’s Extended Fund Facility.
The agreement, however, is subject to approval by the IMF’s Executive Board. High international prices, and a delayed policy action worsened Pakistan’s fiscal and external positions in FY22, led to significant exchange rate depreciation, and eroded foreign reserves.
The IMF in its statement said: “The immediate priority is to stabilize the economy through the steadfast implementation of the recently approved budget for FY23, continued adherence to a market-determined exchange rate, and a proactive and prudent monetary policy. It is important to expand social safety to protect the most vulnerable, and accelerate structural reforms including to improve the performance of state-owned enterprises (SOEs) and governance.”
Pakistan and IMF have reached an agreement. We will soon receive $1.17b as the combined 7th & 8th tranche. I want to thank the PM, my fellow ministers, secretaries and especially the finance division for their help and efforts in obtaining this agreement. https://t.co/376sCHLc1Y
— Miftah Ismail (@MiftahIsmail) July 14, 2022
The board further added: “Additionally, in order to support program implementation and meet the higher financing needs in FY23, as well as catalyze additional financing, the IMF Board will consider an extension of the EFF until end-June 2023 and an augmentation of access by SDR 720 million that will bring the total access under the EFF to about US$7 billion.”
Meanwhile, Finance Minister Miftah Ismail in his tweet expressed his grattitude to PM Shehbaz, ministers, secretaries and especially the finance division for their help and efforts in obtaining this agreement.
