ISLAMABAD: Pakistan’s $33.5 billion external financing needs are fully met for the financial year 2022-23, the State Bank of Pakistan (SBP) chief said on Saturday, adding that “unwarranted” market concerns about its financial position will dissipate in weeks.
Fears have risen about Pakistan’s stuttering economy as its currency fell nearly 8% against the US dollar in the last trading week, while the country’s forex reserves stand below $10 billion with inflation at the highest in more than a decade.
“Our external financing needs over the next 12 months are fully met, underpinned by our ongoing International Monetary Fund (IMF) programme,” the acting governor of Pakistan’s central bank, Murtaza Syed, told Reuters in an emailed reply to questions.
Pakistan last week reached a staff-level agreement with the International Monetary Fund (IMF) for the disbursement of $1.17 billion in critical funding under resumed payments of a bailout package.
“The recently secured staff-level agreement on the next IMF review is a very important anchor that clearly separates Pakistan from vulnerable countries, most of whom do not have any IMF backing,” he said.
However, the lender’s board needs to approve the agreement before the disbursement, which is expected in August, before which there remain prior policy actions to be fulfilled, according to sources familiar with the matter.
But some question Pakistan’s ability to meet external financing needs, including debt obligations, despite the IMF funding.