IMF approves $6 billion loan for Pakistan

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The International Monetary Fund (IMF) headquarters building is seen ahead of the IMF/World Bank spring meetings in Washington, U.S., April 8, 2019. Photo: Reuters/File
The International Monetary Fund (IMF) headquarters building is seen ahead of the IMF/World Bank spring meetings in Washington, U.S., April 8, 2019. Photo: Reuters/File

The International Monetary Fund's (IMF) executive board has approved a three-year, $6 billion loan "to support Pakistan’s economic plan, which aims to return sustainable growth to the country’s economy and improve the standards of living," spokesperson Gerry Rice tweeted on Wednesday evening.

According to AFP, the IMF board has released $1bn to Pakistan immediately. The fund will review Pakistan's performance quarterly over 39 months, phasing release of the additional aid over time.

This is Pakistan's 13th IMF programme.

The finance minister also tweeted about the approval.

Islamabad will receive $2bn annually under an extended fund facility (EFF). According to the IMF, "The EFF provides assistance in support of comprehensive programmes that include policies of the scope and character required to correct structural imbalances over an extended period."

An IMF mission led by Ernesto Ramirez Rigo had visited Islamabad from April 29 to May 11 to discuss a bailout package.

Pakistani authorities and the IMF team had at the conclusion of the visit reached a staff level agreement over a 39-month EFF for about $6bn.

The agreement had been subject to approval by the IMF's executive board.

"The programme aims to support the [Pakistani] authorities’ strategy for stronger and more balanced growth by reducing domestic and external imbalances, improving the business environment, strengthening institutions, increasing transparency, and protecting social spending," the IMF had said in a statement attributed to Rigo.

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