Pakistan Can’t Survive Without Another IMF Assistance, Says PM Shehbaz Sharif

According to Reuters, Pakistan Premier Shehbaz Shirif stressed the importance of another IMF assistance. He said that the economy could not survive without this.

In order to get a $1.1bn tranche next month from the IMF, Sharif stressed that a program of two or three years with the IMF is needed for structural reforms.

This statement comes after a recent IMF announcement indicating that a tentative agreement has been reached with Islamabad for the release of a $1.1billion tranche from a bailout package. This would be the last installment of a rescue package worth $3 billion that Pakistan secured in the summer.

Pakistan faced a crisis in its balance of payments last summer. This led the country to sign a deal worth $3 billion with the IMF. It is now seeking another long-term loan.

IMF officials said that approval of the latest part of the deal will be subject to board approval by the end April as the current agreement expires April 11.

The IMF acknowledged that Pakistan’s financial and economic position has improved since the last review but also highlighted the need for further policy reforms in order to address economic vulnerability. The IMF expects modest growth this year and that inflation will remain above target.

Islamabad showed interest in a second bailout during the review discussions, and it is expected that in the next few months, talks on medium-term aid will begin.

Prime Minister Sharif informed the cabinet of the need for an IMF loan, and stressed the importance to increase the tax base in order to seal the deal.

In a briefing to the cabinet, Finance Minister Muhammad Aurangzeb reiterated this sentiment and said that the IMF deal would improve the economy of the country.

Leave a Comment