ISLAMABAD: Pakistan expects the International Monetary Fund’s (IMF) Executive Board to approve the country’s next loan tranche in early December after reaching a staff-level agreement in October, Finance Minister Muhammad Aurangzeb said on Wednesday.
Last month, the IMF announced it had reached the agreement with Pakistan for the second review of its 37-month Extended Fund Facility (EFF) and the first review of a 28-month Resilience and Sustainability Facility (RSF), a step that could unlock about $1.2 billion once approved by the Fund’s executive board.
Pakistan secured a $7 billion bailout from the IMF in September 2024 after months of negotiations to stabilize its struggling economy, rebuild reserves and attract foreign investment.
Since then, the IMF has said implementation has remained strong, with fiscal and monetary tightening restoring a measure of stability. The current-account balance recorded a surplus, inflation has eased and external buffers have improved.
“We are under the Fund program, so the second review went well and we had a staff-level agreement announced in Washington, and God willing it goes to the board in early December [for approval],” Aurangzeb said while speaking at The Future Summit in Karachi.
He said Pakistan was witnessing a “confluence of favorable factors,” combining macroeconomic stability with what he called “geopolitical tailwinds” from its traditional partners, including China, the United States and the Gulf Cooperation Council countries, particularly Saudi Arabia.
He said the government saw an opportunity to translate this diplomatic and financial support into trade and private-sector-led investment flows, highlighting that sustainable growth must be driven by business and productivity rather than aid.
The minister said corporate profitability had risen by 14 percent during the first nine months of the year, reflecting an underlying strength in Pakistan’s corporate sector.
He also cited a recent Overseas Investors Chamber of Commerce & Industry (OICCI) survey showing that 73 percent of CEOs now view Pakistan as a viable investment destination, up from 61 percent, describing it as a sign of improved investor sentiment.
The minister said Pakistan was now “moving in the right direction” but needed to “stay the course” on structural reforms while recognizing that some areas demanded urgent corrective action.
However, he also mentioned challenges that could jeopardize economic gains.
“These are two areas which I continue to call existential threats for Pakistan: population and climate change,” he said, calling for urgent course correction in both.
Aurangzeb said Pakistan must address rapid population growth and its climate vulnerabilities with the same urgency it has applied to fiscal reforms, noting that “no matter how much we grow, if our population continues to expand at 2.5 percent, we are not going to get where we want to be by 2047.”
He also maintained that technological and digital investments were becoming key drivers of growth and welcomed Google’s decision to open an office in Pakistan and establish the country as a technical and export hub, describing it as “great news.”
“The ball is in our court to provide that ecosystem, to provide that digital infrastructure on the basis of which we can take AI-led growth forward,” he said.
