ISLAMABAD: US Secretary of State Antony Blinken welcomed the International Monetary Fund’s (IMF) move to approve a $3 billion bailout package for Pakistan on Thursday, urging Islamabad to work with the lender to bring about macroeconomic reforms.
Pakistan breathed a sigh of relief on Wednesday when the international lender formally approved the $3 billion stand-by agreement (SBA) for Pakistan which helped the South Asian country, teetering on the edge of a sovereign default, shore up its foreign reserves.
Timely deposits of $2 billion and $1 billion in the State Bank of Pakistan (SBP) by Saudi Arabia and the UAE, respectively, also helped boost investors’ confidence in Pakistan and brought about bullish sentiments in the country’s capital markets.
“We stand by the Pakistani people during these hard times and welcome the International Monetary Fund’s approval of a program to support Pakistan,” Blinken wrote on Twitter.
He urged Islamabad to continue working with the IMF to bring about macroeconomic stability and sustainable economic recovery.
Pakistani officials, particularly Finance Minister Ishaq Dar, held several meetings with American officials in recent months to convince Washington to exert its influence over the IMF and push the lender to approve Pakistan’s bailout program.
After the formal approval from IMF’s Executive Board, Pakistan received inflows of $1.2 billion from the international lender on Thursday.
After the latest inflows, Pakistan’s overall foreign exchange reserves are expected to hit the $13-14 billion mark from the $9.8 billion figure recorded on July 7, 2023.
Pakistan’s official reserves are expected to increase to $8-9 billion, which would be reflected in the central bank’s data on Friday.
