WASHINGTON: The International Monetary Fund (IMF) on Wednesday approved the completion of the sixth review of its programme for Pakistan under the Extended Fund Facility (EFF).
The completion of this review allows for an immediate disbursement of SDR 750 million ( about$ 1 billion) to Pakistan, bringing total disbursements under the arrangement to SDR m ( about$ 3bn) or 106 per cent of the country’s share, said an advertisement released in Washington where the meeting to review the programme was held.
In Islamabad, Finance Minister Shaukat Tarin verified the blessing in a tweet posted on his sanctioned account. “ I’m pleased to advertise that the IMF Board has approved the 6th tranche of their program for Pakistan,” he wrote.
https://twitter.com/shaukat_tarin/status/1488928059562545159
The IMF provides EFF loan installations to a country facing serious medium- term balance of payments problems because of structural sins that bear time to address. Compared to backing handed under the standby arrangement, backing under an extended arrangement features longer programme engagement — to help countries apply medium- term structural reforms — and a longer pre-payment period.
Tarin tweets to confirm approval after Fund’s meeting in Washington
Pakistan made a 39-month EFF arrangement with the IMF in July 2019 for SDR4.268 bn ( about$ 6bn at the time of blessing of the arrangement) package, which was 210pc of the share.
The programme aims to support Pakistan’s programs to help the frugality and save lives and livelihoods amid the still unfolding Covid-19 epidemic, insure macroeconomic and debt sustainability, and advance structural reforms to lay the foundations for strong, job-rich, and long-continuing growth that benefits all Pakistanis.
The sixth review was listed for January 12, 2022, and latterly January 28, but was held up doubly on Pakistan’s request, to attain further time for enforcing IMF conditions.
Pakistan met some of the conditions in the mini-budget passed lately as well as in a bill to grant further autonomy to the State Bank of Pakistan.
Finance ministry officers told intelligencers in Islamabad before this week that they had transferred a report to the IMF about the perpetration of these conditions and were hopeful that the Fund would now release the sixth tranche.
As part of the trouble, the government withdrew subventions and duty concessions of over to Rs343bn and passed a legislation that has awarded lesser autonomy to the central bank.
In November, a finance ministry delegation reached a staff- position agreement with an IMF platoon after prolonged addresses in Washington.
The reversal in rupee line comes after the government succeeded in passing the Finance ( Supplementary) Bill 2021 and the State Bank of Pakistan (Amendment) Bill 2021, amid strong kick by the opposition.
Positive enterprises about the blessing of the IMF arrangement also helped the Pakistani currency, which started the week with a slight enhancement against the US bone, appreciating0.03 pc in the inter-bank request.
