Pakistan and the International Monetary Fund (IMF) have successfully concluded negotiations, resulting in a staff-level agreement, according to media reports on Tuesday late.
According to an official statement from the IMF, the delegation was led by Nathan Porter. The IMF has confirmed that Pakistan now has access to up to $1 billion under the Extended Fund Facility (EFF). The discussions were held in Karachi and Islamabad from 24 February to 14 March 2025 and later continued virtually.
Additionally, the agreement includes a new 28-month programme under the Resilience and Sustainability Facility (RSF), granting Pakistan total access to approximately $1.3 billion (SDR 1 billion). Pending approval by the IMF Executive Board, Pakistan is set to receive around $1.0 billion (SDR 760 million) under the EFF, bringing total disbursements under the programme to nearly $2.0 billion.
Despite various challenges, Pakistan has made strides in restoring macroeconomic stability over the past 18 months. The IMF report highlights that inflation in Pakistan has dropped to its lowest level since 2015, and the overall economic outlook has shown improvement, with further positive developments anticipated.
The IMF also stated that, under this programme, Pakistan’s total disbursement will reach $2 billion. This agreement marks another significant step towards strengthening economic stability in the country.
In addition to reviewing progress under the Extended Fund Facility (EFF), the IMF team and Pakistani authorities have finalised discussions on a new ‘Resilience and Sustainability Facility’ (RSF) agreement.
According to the IMF, Pakistan’s economic reform agenda is being effectively implemented. The government remains committed to gradually reducing the fiscal deficit, keeping public debt at a sustainable level, and curbing inflation through stringent monetary policies.
Furthermore, reforms in the energy sector are being introduced to lower costs and enhance stability. At the same time, the government is accelerating broader economic reforms to promote growth.
Through the new RSF agreement, Pakistan will receive support to strengthen its resilience against natural disasters, improve budget and investment planning to tackle climate change, ensure the efficient use of water resources, enhance climate risk assessment infrastructure, and introduce environmentally sustainable energy sector reforms.
This agreement represents a crucial milestone for Pakistan, paving the way for economic recovery and long-term financial stability.
COMMENTS
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ