WASHINGTON: The Inter­natio­nal Monetary Fund (IMF) announced on Thursday that its Executive Board will meet on Sept 25 to review Pakistan’s 37-month $7 billion Extended Fund Facility (EFF), putting to rest speculation that the agreement might be in jeopardy.

The Staff-Level Agreement (SLA) for a new loan was reached in July, which requires formal approval from the IMF’s Executive Board.

“The board meeting is scheduled to take place on Sept 25, and this follows Pakistan obtaining necessary financing assurances from its development partners,” IMF Director of Strategic Communications Julie Kozack said during a briefing in Washington.

“We are very happy that we can say now that the board meeting is scheduled to take place on Sept 25,” she said. “This is following Pakistan obtaining necessary financing assurances from its development partners.”

Aurangzeb optimistic about increase in economic activities, creation of jobs

Asked if Pakistan has received those assurances, she responded, “Yes.”

She pointed out that the new EFF arrangement follows the successful implementation of the $3bn nine-month SBA in 2023.

She added that consistent policymaking has supported economic stability in Pakistan, most notably a resumption of growth, significant disinflation, and a significant increase in the country’s international reserves.

Pakistani authorities, she said, recognised that consistent implementation of the new EFF would be necessary to successfully and sustainably stabilise the economy and pave the way for stronger and sustainable growth.

“The new programme is really aiming to build on this momentum and to ultimately create a sustainable environment for strong growth and job creation in Pakistan, ultimately for the benefit of the Pakistani people so they can reach their aspirations,” the IMF official said.

Govt optimistic

In a statement issued after the IMF announcement, Finance Minister Muhammad Aurang­zeb said that all matters with the Fund had been settled amicably.

He expressed gratitude to the prime minister’s team, the IMF negotiation team and relevant institutions who played a crucial role in the final stages.

“These matters will be finalised in the IMF Board meeting scheduled for this month,” said the finance minister. “The economy, after stabilisation, is now moving towards growth.”

He said that a reduction in the policy rate will lead to increased investment and business activities, and with the rise in econo­mic activities, employment oppo­r­tunities will also be created.

Published in Dawn, September 13th, 2024