The IMF has approved an immediate disbursal of the final tranche of USD 1.1 billion to Pakistan as part of a bailout package, emphasising that t🦩he cash-s🀅trapped country needs to take tough measures to bring its economy back on track.
The International Monetary Fund (IMF)ဣ Executive Board's decision on Monday came after the global lender completed the second and final review of Pakistan's economic reform programme supported by the IMF's Stand-By Arrangement (SBA).
With this development, the disbursement🦹s und🐭er the SBA reached around USD 3 billion.
All board members favoured the release of the last instalment. India, however, abstained fromಌ voting.
"Given the significant challenges ahead, Pakistan should capitalise on this hard-won stability, persevering -- beyond the current arrangement -- with sound macroeconomic policies and structural reforms to create stronger, inclusive, and sustainable growth," said IMF's Deputy Managing Director Antoinett🥂e Sayeh.
Continued external support wilꦡl also be critical, s✨he said.
Achieving strong, long-term inclusive growth and creating jobs require accel♒erating structural reforms and continued protection of the most vulnerable through an adequately financed Benazi📖r Income Support Programme, she said.
She said that advancing the reform o𓂃f state-owned enterprises (SOEs) and ensuring that all SOEs fall under the new policy framework, strengthening governance and a⛎nti-corruption institutions, and continuing to build climate resilience was the priority.
The 📖IMF♏ official said Pakistan will receive the loan payment this week.
Sayehꦆ emphasised Pakistan needed to adhere to “a mಞarket-determined exchange rate to absorb external shocks and broadening of structural reforms to support stronger and more inclusive growth".
"Moreover, stronger action to address undercapitalised financial institutions and, more broadly, vigilance over the financial sector are needed to ensure finꦅancial stability," she said in a statement.
The development came a day after Prime Minister Shehb𝕴az Sharif met IMF Managing Director Kristalina Georgieva in Riyadh, Saudi Arabia.
In his first meeting with the IMF chief since his re-election as pre♒mier, Sharif also discussed Pakistan's demand for another IMF programme as the country still needs the global len🦩der's crutches to wobble on to get its economy back on track.
An IMF team is expected t꧟o visit Pakistan in May to initiate talks for a new long-term Extended🐭 Fund Facility (EFF) ranging between USD 6 to USD 8 billion with the possibility of augmentation through climate financing.
However, the exact size and time frame will on⛦ly be determine🏅d after evolving consensus on the major contours of the next programme in May 2024.
If secured, it would be Pakistan's 24th IMF ba✱ilout.
Separately, former prime minister Shahid Khaqan Abbasi said all indicators of the economy were negative and the government's decision to seek another bailout from the IMF was an admission of their "failure"♑, The Express Tribune newspaper reported.
"Economic growth stalls and inflation rises due to such agreements withജ the IMF," he said, adding that the IMF “keeps you alive, but your economic condition deteriorates on every parameter."
"Your industry cannot thrive if political issues remain unresolved, as everything is interconnected. Do not harbour the illusion that things will improve spontaneousl🎀y," he cautioned.
Abbasi pointed out that IMF agreements impede growth🗹 and exacerbate inflation.
The USD 350 billion economy faces a chronic balance of payments crisis, with nearly USD 24 bi🥃llion to repay in debt and interest over the next fiscal year — three times more than its central bank's foreign currency reserves
