NEW YORK: IMF says further discussions with Pakistan on structural reforms needed
In a regular press briefing, IMF spokesman Gerry Rice said that the Fund is holding open, constructive discussions with Pakistan as part of a sixth review of the country’s 39-month, $6 billion financing programme that began in 2019.
Rice declined to say if disbursements under that programme had been halted but said further discussions were needed about Pakistan’s fiscal spending plans and structural reforms.
“We stand ready to continue to support Pakistan,” he said, adding, “As the recovery gains strength, it will be important to accelerate the implementation of policies and reforms needed to address some of the long-standing challenges facing the Pakistani economy.”
Pakistani authorities and IMF, for the time being, have agreed to continue talks to narrow down differences, but the IMF-sponsored programme has been put on halt mode as the Fund has conveyed that the sixth review under the Extended Fund Facility (EFF) will be accomplished in September this year instead of July 2021.
Following allegations by former finance minister Miftah Ismail that the IMF programme had been suspended, the Ministry for Finance had issued a statement to clarify that this was not the case.
Last week, Minister for Finance Shaukat Tarin ruled out the possibility of Pakistan’s exit from the IMF programme, during his discussion with the Senate Standing Committee on Finance in Parliament House.
Pakistan this month set a growth target of 4.8% for the 2021-22 financial year and a fiscal deficit target of 6.3%. The country surpassed growth projections in the 2020-21 financial year despite a third wave of COVID-19 infections, reaching GDP growth of 3.96%, after a 0.47% contraction in 2019-20.
