ISLAMABAD: Prime Minister Shehbaz Sharif welcomed the International Monetary Fund’s (IMF) decision to approve a $7 billion loan program for the country, his office said on Wednesday.
The IMF has approved the bailout package for Pakistan after the South Asian nation agreed to strengthen fiscal and monetary policy and implement reforms to broaden the tax base, secure a level playing field for investment and enhance human capital.
In July, the Fund reached a staff-level agreement on economic policies with Pakistan for 37-month Extended Fund Facility (EFF) of about $7 billion. The IMF executive board has now approved the 25th loan program that Pakistan has obtained since 1958.
“We will continue to struggle to achieve economic progress targets,” the prime minister said while expressing satisfaction over approval of the IMF loan package.
“If this hard work continues, this will be Pakistan’s last IMF program,” he continued while thanking the friendly countries including Saudi Arabia, China and the United Arab Emirates for their support to get the program.
Economists have termed the loan approval a positive development that would help boost investors’ confidence and make it possible for the government to tap international markets for the commercial borrowing.
Dr. Khaqan Hassan Najeeb, senior economist and former adviser to the government, said Pakistan’s engagement with the IMF could strengthen the nascent macroeconomic stability.
“It will ensure the $26 billion, Pakistan’s gross financing needs are fully met and can bring the other lenders, commercial banks, bilateral and multilateral partners on board,” he told Arab News.
“More importantly, it buys Pakistan time and breathing space to do the structural work that is necessary to put the economy on a path that it does not have to go to the doorsteps of the IMF for the 26th time,” he said.
Ahsan Mehanti, chief executive officer of Arif Habib Corporation, one of Pakistan’s leading business groups termed the IMF loan approval “a positive development,” saying this would help the country get the bilateral and multilateral support from different financial institutions including activation of $2 billion loan from the Asian Development Bank.
“This IMF loan program will help the stocks reach new heights with a boost to investor confidence and stabilize the rupee against the US dollar,” Mehanti told Arab News.
The IMF said in its statement the three-year loan program “will require sound policies and reforms” to support Pakistan’s ongoing efforts to strengthen its economy “and create conditions for a stronger, more inclusive, and resilient growth.”
It acknowledged Pakistan “has taken key steps to restoring economic stability with consistent reforms,” though it noted that the country’s vulnerabilities and structural challenges remained formidable.
“A difficult business environment, weak governance, and an outsized role of the state hinder investment, which remains very low compared to peers,” it added.
IMF Chief Kristalina Georgieva also held a brief meeting with the Pakistani prime minister on the sidelines of the 79th United Nations General Assembly Session.
“We do have good news,” she told the media following the meeting. “We have completed the review of the [loan] program successfully. I want to congratulate the government of Pakistan and the people of Pakistan for moving forward with the home-defined, Pakistan-owned reforms, and they are bringing fruits. Growth is up. Inflation is down. The economy is on a sound path.”
“The government aims to collect taxes from the rich and strengthening the Benazir social program to support the poor,” she added.
With input from AFP
IMF executive board approves $7 billion loan program for Pakistan
https://arab.news/m6gyz
IMF executive board approves $7 billion loan program for Pakistan
- Pakistani PM welcomes deal, thanks Saudi Arabia, UAE, China for continued support to get loan package
- Economists say the program will strengthen macroeconomic stability, help in talks with other financial agencies
Pakistan, global crypto exchange discuss modernizing digital payments, creating job prospects
- Pakistani officials, Binance team discuss coordination between Islamabad, local banks and global exchanges
- Pakistan has attempted to tap into growing crypto market to curb illicit transactions, improve oversight
ISLAMABAD: Pakistan’s finance officials and the team of a global cryptocurrency exchange on Friday held discussions aimed at modernizing the country’s digital payments system and building local talent pipelines to meet rising demand for blockchain and Web3 skills, the finance ministry said.
The development took place during a high-level meeting between Finance Minister Muhammad Aurangzeb, Pakistan Virtual Assets Regulatory Authority (PVARA) Chairman Bilal bin Saqib, domestic bank presidents and a Binance team led by Global CEO Richard Teng. The meeting was held to advance work on Pakistan’s National Digital Asset Framework, a regulatory setup to govern Pakistan’s digital assets.
Pakistan has been moving to regulate its fast-growing crypto and digital assets market by bringing virtual asset service providers (VASPs) under a formal licensing regime. Officials say the push is aimed at curbing illicit transactions, improving oversight, and encouraging innovation in blockchain-based financial services.
“Participants reviewed opportunities to modernize Pakistan’s digital payments landscape, noting that blockchain-based systems could significantly reduce costs from the country’s $38 billion annual remittance flows,” the finance ministry said in a statement.
“Discussions also emphasized building local talent pipelines to meet rising global demand for blockchain and Web3 skills, creating high-value employment prospects for Pakistani youth.”
Blockchain is a type of digital database that is shared, transparent and tamper-resistant. Instead of being stored on one computer, the data is kept on a distributed network of computers, making it very hard to alter or hack.
Web3 refers to the next generation of the Internet built using blockchain, focusing on giving users more control over their data, identity and digital assets rather than big tech companies controlling it.
Participants of the meeting also discussed sovereign debt tokenization, which is the process of converting a country’s debt such as government bonds, into digital tokens on a blockchain, the ministry said.
Aurangzeb called for close coordination between the government, domestic banks and global exchanges to modernize Pakistan’s payment landscape.
Participants of the meeting also discussed considering a “time-bound amnesty” to encourage users to move assets onto regulated platforms, stressing the need for stronger verifications and a risk-mitigation system.
Pakistan has attempted in recent months to tap into the country’s growing crypto market, crack down on money laundering and terror financing, and promote responsible innovation — a move analysts say could bring an estimated $25 billion in virtual assets into the tax net.
In September, Islamabad invited international crypto exchanges and other VASPs to apply for licenses to operate in the country, a step aimed at formalizing and regulating its fast-growing digital market.
