The International Monetary Fund (IMF) on Friday issued an end-of-mission statement, describing as “strong” Pakistan’s implementation of the $7 billion Extended Fund Facility (EFF).
An IMF mission, led by Nathan Porter, visited Islamabad and Karachi from Feb. 24-March 14 as part of the first review of the EFF. The two sides also deliberated on a possible new arrangement under the IMF’s Resilience and Sustainability Facility (RSF).
“The IMF and the Pakistani authorities made significant progress toward reaching a Staff Level Agreement (SLA) on the first review under the 37-month Extended Arrangement under the Extended Fund Facility (EFF),” read a statement issued by Porter at the conclusion of the discussions.
“Program implementation has been strong, and the discussions have made considerable progress in several areas including the planned fiscal consolidation to durably reduce public debt; maintenance of sufficiently tight monetary policy to maintain low inflation; acceleration of cost-reducing reforms to improve energy sector viability; and implementation of Pakistan’s structural reform agenda to accelerate growth, while strengthening social protection and rebuilding health and education spending,” he said.
Porter further noted progress in discussions on authorities’ climate reform agenda. The plan, he said, aims to reduce the country’s vulnerabilities from natural disasters-related risks. Required reforms, he said, could be supported under a possible arrangement under the RSF.
“The mission and the authorities will continue policy discussions virtually to finalize these discussions over the coming days,” he said. “The IMF team is grateful to the Pakistani authorities, private sector, and development partners for fruitful discussions and their hospitality throughout this mission,” he added.
According to official sources, the government hopes to finalize the staff-level agreement by the end of this month, with the disbursement of the next tranche of $1.1 billion early next month.