Pakistan’s Finance Minister, Muhammad Aurangzeb, has expressed optimism about securing a new loan from the International Monetary Fund (IMF). Speaking with The National, Aurangzeb noted the IMF’s willingness to consider a larger and longer-term program for Pakistan.
The country has formally requested a bailout package of $6-$8 billion under the EFF, with the potential for additional climate financing. The exact size and timeline of the loan will be determined once consensus is reached on the program’s details in May 2024.
Aurangzeb highlighted positive macroeconomic shifts, including a stabilized rupee and declining inflation, which are expected to reach single-digit levels by the end of 2024. He emphasized the need for three years of IMF support to implement reforms across sectors like taxation and energy.
Last week, the IMF’s Middle East and Central Asia director, Jihad Azour, stated that the organization is ready to support Pakistan. Azour stressed the importance of accelerating reforms to unlock Pakistan’s growth potential.
In March 2023, Pakistan and the IMF reached a staff-level agreement for the release of $1.1 billion under the Standby Arrangement (SBA) program. The IMF has indicated Pakistan’s interest in a successor medium-term program to address its fiscal and external sustainability challenges.
