Islamabad, Pakistan – The government of Pakistan has made yet another appeal to the International Monetary Fund (IMF) to release the $1.1bn tranche, pending since November last year, as the $6.5bn loan programme nears its scheduled expiry at the end of June.
Prime Minister Shehbaz Sharif met IMF’s managing director Kristalina Georgieva in Paris on Thursday and said the country has completed all the requirements asked for by the lender.
Sharif added that Pakistan was “fully committed” to fulfilling its obligations, according to a statement issued by the prime minister’s office.
Sharif, who is in France to attend the Summit for a New Global Financial Pact, expressed his hope that the funds would be released at the earliest and would “help strengthen Pakistan’s ongoing efforts towards economic stabilisation, and bring relief to its people”, the statement read.
On the sidelines of the Summit for a New Global Financial Pact being held in Paris, France, PM Shahbaz Sharif met Ms. Kristalina Georgieva, MD of the International Monetary Fund (IMF). Views were exchanged on the ongoing programmes and cooperation between Pakistan and IMF. pic.twitter.com/05rKbNVpi8
— Prime Minister’s Office (@PakPMO) June 22, 2023
Pakistan entered a $6bn IMF programme in 2019, which was later increased by another $500m last year. Pakistan received a $1.17bn tranche from the programme in August 2022, as part of it its seventh and eighth reviews.
IMF sent its delegation to Pakistan for a 10-day visit earlier this year to negotiate the conditions for the ninth review but the tranche remains undelivered with the programme’s expiry date set for June 30.
Pakistan is facing a dire economic situation now with multiple challenges mounting due to the balance-of-payment crisis, devaluing currency, skyrocketing inflation, and massive debt obligations due later this year.
It is left with just $4bn of foreign currency reserves with the central bank, enough to cover four weeks of import, while its currency has lost more than 50 percent of its value against the US dollar during the last year.
According to government data, inflation has reached almost 38 percent and the IMF, in its global economic outlook report, released in April, forecasted the South Asian country’s economy will grow just 0.5 percent this year, down from six percent in 2022.
Pakistan also presented its budget earlier in June with a $50bn outlay, calling it a “responsible” budget, but the lender, in its statement, questioned some of the policies and called it a “missed opportunity”.
Pakistan’s central bank’s data shows that the country is expected to pay more than $4bn by the end of this year alone, while a total of $77bn is due by 2026, according to a recent report by the United States Institute of Peace.
The country has also been caught in political turmoil in an election year, which is scheduled to take place by October, with parliament completing its tenure by August.