ISLAMABAD: Prime Minister Shehbaz Sharif on Wednesday described 2024 as a year of economic recovery and expressed hope for self-reliance in the new year, while acknowledging persistent security challenges caused by a surge in militant violence.
Pakistan narrowly avoided a sovereign debt default in 2023 after securing short-term external financing from the International Monetary Fund (IMF) under a $3 billion bailout program.
The agreement required Islamabad to implement stringent economic reforms, including subsidy cuts and utility price hikes, to stabilize its fragile economy. While macroeconomic indicators have since improved, many Pakistanis continue to grapple with the lingering effects of years of financial turmoil and the burden of reforms.
The government also managed to secure another IMF loan of $7 billion last year in September, saying it was important to get the money to consolidate the economic gains.
“2024 was a remarkable year for Pakistan, as we marched from default to development, overcoming economic challenges with resilience and determination,” Sharif wrote on X, formerly Twitter. “We made difficult but necessary decisions that rescued our economy from collapse, restored macroeconomic stability, controlled fiscal deficits, and strengthened our reserves. As a result, inflation has come down to single digits, and the prospects for economic growth have been revived.”
“We step into 2025 with renewed determination to achieve economic self-reliance and chart a brighter, more prosperous future for our nation,” he added.
Sharif’s remarks also addressed the security situation, highlighting Pakistan’s armed forces’ efforts to counter a renewed wave of militant violence.
“Amidst other challenges, Pakistan also faced a renewed surge in terrorism this year,” he said, reaffirming the military’s commitment to ensuring peace.
He credited the nation’s unwavering support for its forces in their fight against militants who, he maintained, “stand in stark opposition to the very idea of Pakistan.”
The prime minister also highlighted the launch of “Uraan Pakistan,” or “Fly Pakistan,” which is a homegrown five-year, export-oriented economic transformation plan unveiled by his administration a day earlier, which he described as a result of his government’s vision to build on recent stability and achieve sustained growth.
Pakistan PM vows to work for ‘economic self-reliance’ in 2025 amid security challenges
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Pakistan PM vows to work for ‘economic self-reliance’ in 2025 amid security challenges
- Shehbaz Sharif calls 2024 ‘a remarkable year of Pakistan’ in which it ‘marched from default to development’
- He acknowledges the renewed threat of militant violence while praising the military’s efforts to counter it
IMF board to approve Pakistan reviews today ‘if all goes well,’ say officials
- IMF’s executive board is scheduled to meet today to discuss the disbursement of $1.2 billion
- Economists say the money will boost Pakistan’s forex reserves, send positive signals to investors
KARACHI: The International Monetary Fund’s (IMF) executive board is scheduled to meet today, Monday, to approve the release of about $1.2 billion for Pakistan under the lender’s two loan facilities, said IMF officials who requested not to be named.
The IMF officials confirmed the executive board was going to decide on the Fund’s second review under the $7 billion Extended Fund Facility (EFF) and first review under the $1.4 billion Resilience and Sustainability Facility (RSF), a financing tool that provides long-term, low-cost loans to help countries address climate risks.
“The board meeting will be taking place as planned,” an IMF official told Arab News.
“The board is on today yes as per the calendar,” said another.
A well-placed official at Pakistan’s finance ministry also confirmed the board meeting was scheduled today to discuss the next tranche for Pakistan.
The IMF executive board’s meeting comes nearly two months after a staff-level agreement (SLA) was signed between the two sides in October.
Procedurally, the SLAs are subject to approval by the executive board, though it is largely viewed as a formality.
“If all goes well, the reviews should pass,” said the second IMF official.
On approval, Pakistan will have access to about $1 billion under the EFF and about $200 million under the RSF, the IMF said in a statement in October after the SLA.
The fresh transfer will bring total disbursements under the two arrangements to about $3.3 billion, it added.
Experts see smooth sailing for Pakistan in terms of the passing of the two reviews, saying the IMF disbursements will help the cash-strapped nation to strengthen its balance of payments position.
Samiullah Tariq, group head of research at Pakistan Kuwait Investment Company Limited, said the IMF board’s approval will show that Pakistan’s economy is on the right path.
“It obviously will help strengthen [the country’s] external sector, the balance of payments,” he told Arab News.
Until recently, Pakistan grappled with a macroeconomic crisis that drained its financial resources and triggered a balance of payments crisis.
Pakistan has reported financial gains since 2022, recording current account surpluses and taming inflation that touched unprecedented levels in mid-2023.
Economists also viewed the IMF’s bailout packages as crucial for cash-strapped Pakistan, which has relied heavily on financing from bilateral partners such as Saudi Arabia, China and the United Arab Emirates, as well as multilateral lenders.
Saudi Arabia, through the Saudi Fund for Development, last week extended the term of its $3 billion deposit for another year to help Pakistan boost its foreign exchange reserves, which stood at $14.5 billion as of November 28, according to State Bank of Pakistan statements.
“In our view this [IMF tranche] will be approved,” said Shankar Talreja, head of research at Karachi-based brokerage Topline Securities Limited.
“This will help strengthen reserves and will eventually help a rating upgrade going forward,” he said.
The IMF board’s nod, Talreja said, would also send a signal to the international and local investors regarding the continuation of the reform agenda by Pakistan’s government.
