By Monitoring Desk
KARACHI: The International Monetary Fund (IMF) and Pakistan are currently in talks regarding a potential follow-up program to the existing nine-month, $3 billion stand-by arrangement, IMF Managing Director Kristalina Georgieva said on Thursday.
“It (Pakistan) had important issues to solve,” IMF chief Georgieva was quoted as saying by Reuters.
Georgieva told an event at the Atlantic Council think tank, that Pakistan was successfully completing its existing program with the IMF and its economy was performing somewhat better, with reserves now being built up.
“There is a commitment to continue on this path, and the country is turning to the fund for potentially having a follow-up program,” Georgieva said, flagging issues that the struggling South Asian nation still needed to address.
“There are very important issues to be solved in Pakistan: the tax base, how the richer part of society contributes to the economy, the way public spending is being directed and of course, creating … a more transparent environment.”
Pakistan and the IMF last month reached a staff-level agreement on the second and last review of the $3 billion stand-by arrangement, which, if cleared by the global lender’s board, will release about $1.1 billion to the struggling South Asian nation. The IMF’s board is expected to review the matter in late April, but no firm date has been set, a spokesperson said.
Both sides have also spoken about negotiating a longer-term bailout and continuing with necessary policy reforms to rein in deficits, build up reserves, and manage soaring debt servicing.
Finance Minister Muhammad Aurangzeb expressed optimism last month about finalizing an agreement with the IMF by the fiscal year’s end on June 30.
Aurangzeb had said the Fund was “very receptive” to a “larger and longer programme” in his recent communications with them. The minister had said that details of the deal would be discussed during the spring meetings. (Information courtesy Reuters)
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