Minister hopes to clinch IMF deal today

"We are very hopeful the board would approve the 37-month $7 billion programme," Finance Minister Aurangzeb says

LAHORE:

Finance Minister Senator Muhammad Aurangzeb on Tuesday expressed optimism that the IMF board would approve the 37-month $7 billion Extended Fund Facility (EFF) arrangement for Pakistan in its meeting scheduled on Wednesday.

He was speaking at "High Level Private Sector Dialogue - CPEC-II and the Region" virtually through Zoom. The event was organized by Pakistan Regional Economic Forum.

"Pakistan successfully concluded the nine-month Standby Agreement (SBA) with IMF and we have the IMF board meeting tomorrow here in US. We are very hopeful the board would approve the 37-month $7 billion programme," he said.

The minister said, under the programme Pakistan was committed to do structural reforms. He said Pakistan needed to stay on reforms agenda whether on taxation, energy sector, state-owned enterprises or privatization side. "We will stay on course."

He expressed gratitude to China for its support on the fund programme as the lone standing partner of the country. The minister highlighted that Pakistan's economic trajectory has continued from the last fiscal year into the first quarter of this fiscal year, with notable improvements in various economic indicators.

He said the currency was stable while foreign exchange reserves were also stable with two months import cover. He said inflation has decelerated and, more importantly, policy rate has come down and Kibor rates also declined to the benefit of industry.

He said recently the government had rejected Treasury Bills (T-bills) and Pakistan Investment Bonds (PIBs), saying the decision aimed at conveying a clear message that the government was no longer desperate to borrow domestically. He said if required, the government would borrow domestically on its own terms, signaling the banking sector to lend to the private sector.

However, he said investment inflows in terms of debt and equity were welcome that would bring FDI into the country. He said macroeconomic stability was necessary and a foundation has been laid to promote economic stability.