ISLAMABAD / LAHORE: Prime Minister Shehbaz Sharif on Saturday said the International Monetary Fund (IMF) has no reason to delay the approval of the staff-level agreement after financial assurances from friendly countries, even as a Fund official said the lender looked forward to “necessary financing assurances” as soon as possible to pave way for the completion of the ninth review of the $7 billion programme.
The statement came from IMF Mission Chief to Pakistan Nathan Porter, a day after Finance Minister Ishaq Dar announced the confirmation of $1bn in bilateral financial support to Pakistan, believed to be the last prior action for staff-level agreement with the global lender.
Speaking during a ceremony in Lahore, PM Shehbaz said: “The IMF had set a condition for us to arrange funds from friendly countries before it signed a staff-level agreement with us. We put up an effort of one-and-a-half months to first have a rollover of $2bn from China and then $3bn from Saudi Arabia and the UAE, thus meeting the last condition of the IMF.”
“The new army chief made efforts to acquire the funds from Saudi Arabia and the UAE,” the premier said and also praised Bilawal Bhutto-Zardari and Ishaq Dar for their ‘hard work’ in this regard.
Lender stresses need to ‘maintain strong policies’; Shehbaz admits no option but to accept ‘stringent conditions’
He said that his government “inherited an IMF agreement that was in tatters” while expressing the determination to overcome these challenges by striking a deal with the global lender as soon as possible. He acknowledged that the government had to accept the stringent conditions set by the IMF as there was “no alternative”.
IMF asks to do more
Meanwhile, the Fund welcomed bilateral assistance confirmation to Pakistan but sought further assurances to seal the deal with Islamabad.
During the meetings between the Pakistani delegation and IMF staff and management, there was an agreement to maintain strong policies and secure sufficient financing to support the implementation efforts, the statement said.
“The IMF is supporting these efforts and looks forward to obtaining the necessary financing assurances as soon as possible to pave the way for the successful completion of the 9th External Fund Facility review,” it added.
An official source said that the Fund is still waiting for assurances from friendly countries contesting an earlier statement by the government which had claimed that the assurance of $2bn from Saudi Arabia and $1bn from the UAE would resolve the issue. Mr Dar had also announced that the State Bank had received the last disbursement from the Industrial and Commercial Bank of China worth $300 million out of its $1.3bn loan.
IMF head Kristalina Georgieva had hoped Pakistan would complete its current programme.
“My hope is that with the goodwill of everyone, with the implementation of what has been already agreed by the Pakistani authorities, we can complete our current programme successfully,” she said at a news briefing in Washington.
Separately, Mr Dar held a virtual meeting with Jin Liqu, the Asian Infrastructure and Investment Bank (AIIB) president, through a video link as part of the IMF/World Bank spring meetings.
An official announcement said that Mr Dar shared the current economic outlook and apprised the AIIB president of the government’s economic policies and reforms for sustainable development.
The AIIB president lauded the bank’s relationship with Pakistan, said the announcement.
Published in Dawn, April 16th, 2023
