ISLAMABAD: A team of Pakistani officials began talks today, Wednesday, with representatives of the International Monetary Fund (IMF) in Doha as part of the seventh review of a $6 billion program Pakistan secured in 2019, the Pakistani finance ministry said.
The IMF has so far disbursed $3 billion to Pakistan under its Extended Funds Facility (EFF). If the latest review is cleared, Pakistan will receive another tranche of more than $900 million, which would in turn unlock additional external funding.
The review has been stalled since the last government of now ex-Prime Minister Imran Khan announced in February around $1.7 billion relief in energy prices, deviating from the objectives of the IMF program.
The South Asian nation is in dire need of external finances due to a widening current account deficit and rapidly depleting foreign exchange reserves. The new government also needs to deal with double-digit inflation and slow growth of the economy, which the IMF said in its last report was likely to stay at 4 percent against an earlier projection of 4.8 percent.
“Finance Division’s team is leaving for consultations with the IMF Mission at Doha from tonight,” the Pakistani finance ministry said in a tweet on Tuesday. “Meetings will start from tomorrow.”
Last month, Pakistan’s Finance Minister Miftah Ismail traveled to Washington to hold talks with IMF officials. After initial discussions, Ismail said the IMF had agreed in principle to extend its bailout package for another year and increase the total loan size by $2 billion.
On April 24, IMF Pakistan mission chief Nathan Porter said it had been agreed after a meeting with Ismail “that prompt action is needed to reverse the unfunded subsidies, which have slowed discussions for the 7th Review.”
Pakistan requested the “IMF to extend the EFF arrangement through June 2023 as a signal of their commitment to address existing challenges and achieve the program objectives,” Porter said.