Pakistan: Sharif govt to approach IMF 'immediately after budget' for new programme
Since November last year, Pakistan has been negotiating with IMF to revive its bailout programme, with the financing gap among the biggest roadblocks. About $2.5 billion is left to be disbursed from the $6.5 billion programme that’s scheduled to expire on June 30
Pakistani Prime Minister Shehbaz Sharif
The Shehbaz Sharif-led Pakistani government will negotiate a new programme with the International Monetary Fund (IMF) immediately after the budget as it is reportedly planning to conclude the $6.5 billion Extended Fund Facility (EFF) without completing all the pending reviews.
Since November last year, Pakistan has been negotiating with IMF to revive its bailout programme, with the financing gap among the biggest roadblocks. About $2.5 billion is left to be disbursed from the $6.5 billion programme that’s scheduled to expire on June 30, Geo News reported.
While negotiations on the ninth review were almost complete, a staff-level agreement is yet to be reached, the report quoted sources as saying.
Even when ninth one completes, the 10th and 11th reviews will remain pending.
“Completion of both reviews before June 30 seems impossible and the government has decided against seeking an extension,” Geo News quoted sources as saying.
They added that Pakistan’s Ministry of Finance will approach the Fund for a new programme after budget — which is expected to be tabled on June 9.
If the coalition government fails to complete the negotiations before its term ends in August, in that case the caretaker government will hold talks with IMF, sources shared.
On the new programme, sources told Geo News that the economic team has begun working on the agreement “which is expected to be tougher” than the existing programme agreed in 2019 by Imran Khan-led Pakistan Tehreek-e-Insaf (PTI) government.
The new bailout programme will likely be for more than three years, sources said and added, “Pakistan will desperately need an IMF programme in September as the country needs to pay around $9-11 billion dollars in repayments of external debt by December 2023”.
(With inputs from agencies)
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