ISLAMABAD: Despite terming the meeting as ‘positive’, Pakistan and the International Monetary Fund (IMF) failed to strike any breakthrough in their talks held the other day, as no side announced any date for mission’s visit to Islamabad.
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The meeting came as the IMF had withheld the release of $1.1 billion loan tranche due to disagreement over the exchange rate policies, power tariff and a major gap in the fiscal framework. The gross official foreign exchange reserves slipped to a nine-year low of $4.5 billion last week – enough to finance three weeks of imports.
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The finance minister said last week that nearly $6 billion of private commercial banks’ reserves also belonged to Pakistan. However, the central bank has already borrowed $5 billion out of the $5.8 billion held by the commercial banks as of November 30, 2022.
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According to a report made available here on Tuesday, the purpose of the meeting was to reach a consensus on the measures that would ensure the negotiations for the 9th programme review. But surprisingly, the finance ministry tweeted that Finance Minister Ishaq Dar and IMF Mission Chief Nathan Porter “discussed challenges to regional economies in the wake of climate change”.
(1/)2…Finance Minister Senator Muhammad Ishaq Dar held a meeting with IMF Mission Chief to Pakistan Mr. Nathan Porter, on the side lines of International Conference on 'Climate Resilient Pakistan' at Geneva on 9th Jan,2023 pic.twitter.com/ym11Xer4dl
— Ministry of Finance, Government of Pakistan (@Financegovpk) January 9, 2023
The report quoted sources from Geneva saying that Pakistan would have to take certain measures before the IMF sent a staff-level mission. Last week, Prime Minister Shehbaz Sharif had announced that the IMF team would visit Pakistan in three days for programme negotiations – a deadline that has already passed.
Dar met Porter on the sidelines of the International Conference on Climate Resilient Pakistan in Geneva, according to the finance ministry. It added that they “discussed challenges to regional economies” in the wake of climate change. “The finance minister reiterated the commitment to complete the Fund programme,” it said.
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There was no one from the finance ministry to assist Dar at the talks with the IMF. Instead, the meeting was attended by Economic Affairs Minister Sardar Ayaz Sadiq and Economic Affairs Secretary Kazim Niaz. Under the rules of the business, the IMF is the subject of the Finance Division.
According to the report, Reuters quoted Thanos Arvanitis, the deputy director of the IMF’s Middle East and Central Asia department, as saying that “it was a good meeting but I do not have any statements to make”.
A Pakistani delegate said that the IMF mission would soon visit Pakistan but the country would have to show progress on things that were already under discussion. “The IMF team does not make any fresh demand,” according to a source familiar with the discussions.
