By Staff Reporter
ISLAMABAD: The International Monetary Fund (IMF) said on Friday it was ready to work with Pakistan’s new government to complete the second review of its $3 billion bailout program and support a new medium-term economic plan if requested.
The IMF’s statement came after a letter from the opposition party of former prime minister Imran Khan, who alleged electoral fraud in the February 8 general election that resulted in a hung parliament and a coalition government.
The PTI, which emerged as the largest group in the parliament, has accused the ruling coalition led by the Pakistan Muslim League-Nawaz (PML-N), of rigging the vote and demanded a probe.
The IMF, which has a narrow mandate on economic issues, said it did not comment on domestic political developments but encouraged the fair and peaceful resolution of all electoral disputes.
“However, given the importance of the institutional environment for economic stability and growth, we do encourage the fair and peaceful resolution of all electoral disputes,” the IMF said in a statement.
The IMF’s second review of the 9-month standby $3 billion program is pending. The program will expire in April and the last review was expected to unlock about $1.1 billion in fresh funds.
The IMF said its aim was to support the implementation of strong policies to deepen financial stability, address longstanding economic and balance of payments challenges, and restore sustained and inclusive growth for the benefit of all Pakistani citizens.
This includes stronger public finances, through high-quality revenue measures to broaden the tax base while scaling up the support for the most vulnerable, restoring energy sector viability, improving institutional governance and anti-corruption effectiveness, state-owned enterprise reform, building climate resilience, and creating a level playing field for private businesses to promote investment and job creation.
“On the basis of these objectives, we look forward to engaging with the new government to complete the second review under the current stand-by arrangement and, should the government request, support the formulation of a new medium-term economic program,” the IMF said.
The IMF team is expected to arrive in Pakistan next week to discuss the details of the second review and the possible augmentation of the program. Pakistan is also planning another bailout package with climate finance, as it faces the dual challenges of recovering from the economic slowdown and adapting to the impacts of climate change.
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