By Staff Reporter
ISLAMABAD: Finance Minister, Ishaq Dar said on Sunday the country will share its upcoming budget details with the International Monetary Fund (IMF) to unlock funds that have been stalled since November last year.
Dar said he would like the IMF to clear its 9th review before the budget, which is due to be presented in early June, as all the conditions for that had already been met.
“They have asked for some more things again, we are ready to give that too, they say that give us budget details, we will give it to them,” Dar said in an interview with local Geo TV.
He said it would not work for Pakistan if the IMF combined the 9th and 10th review of the bailout, adding, “We will not do it, (we) see this is (as) unfair.”
Economists said the IMF wants to ensure that the government remains committed to the agreed path of fiscal consolidation as the country prepares for elections later this year. Historically, the biggest fiscal slippages in Pakistan occur in an election year, they added.
It is unclear whether the budget review will affect the pending ninth review or whether it will be part of the two reviews that remain after this.
Earlier this month the IMF’s country mission chief, Nathan Porter, said that the budget review is a necessary step before the lender can approve the release of pending bailout funds that are critical to resolving Pakistan’s acute balance of payments crisis.
Pakistan has struggled to reach a deal with the IMF to release funds critical to stabilizing the economy.
A staff-level agreement to release $1.1 billion has been delayed since November. The tranche is part of a $6.5 billion bailout package that the IMF approved in 2019, which is due to end in June, prior to the budget.
Pakistan is reeling from an economic crisis, with inflation surging to 36.4 percent, the highest in its history and the highest in South Asia. The country is expected to face further economic challenges as it prepares for elections later this year.
In March, the IMF asked Pakistan to secure financing assurances from friendly states and multilateral donors before it could release the tranche, after which China rolled over its $2 billion loan to the cash-strapped South Asian nation. This was followed by a $2 billion pledge by Saudi Arabia and the UAE promising $1 billion support to Islamabad.
Defense Minister Khawaja Asif last week said Saudi Arabia would be depositing funds worth $2 billion in the central bank before the revival of a stalled bailout program.
“The IMF asked them (Saudi Arabia) to give that commitment to them. They (Saudi Arabia) have already given that, that means that they will pay [the funds to Pakistan],” Asif was quoted by the Arab News.
“I think, if I am not wrong, they will be depositing that money ($2 billion) before the IMF program. The IMF is not giving us something, not a big amount. It is just a program which we have to complete till 30th of June.”
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