The country has just enough reserves to cover three weeks’ worth of crucial imports, and the administration has until November to undertake the measures necessary to achieve an agreement with the IMF.
Dar said that “I and my team are committed to completing this [IMF] programme to the best of our ability…We seem to be very close to signing a staff-level agreement hopefully in the next few days.”
The economy was “in a shambles” when it was given to the coalition administration, he remembered.
“To top it [off], the previous government had agreed to a loan facility which was extended by the IMF. Unfortunately, instead of honouring the commitments, they didn’t implement but, before leaving the office, reversed some conditionalities they had implemented earlier. This led to a serious trust deficit between development partners and Pakistan,” he remarked.
Nonetheless, the minister continued, the government has opted to uphold the agreements after realising that these duties were made by Pakistan’s sovereign state and not by a person.
“We have been in the process of the 9th review which has taken longer than it should have […] we seem to be very close to signing the staff-level agreement, hopefully in the next two days,” Dar highlighted.
The conclusion of the ninth review of a $7 billion loan programme, which has been postponed since late last year due to a policy framework, would result in the payout of $1.2 billion as well as the opening of inflows from friendly nations.
Slowly but surely, Pakistan and the IMF are making progress towards a staff-level agreement. The Memorandum of Economic and Financial Policy (MEFP), a collection of policies that the nation will execute throughout the remaining portion of the current fiscal year, has not yet been finalised. However, there are still a few concerns that need to be resolved.
