ISLAMABAD: The signing of the staff-level agreement between Pakistan and the International Monetary Fund (IMF) has been delayed again due to new demand from the international lender.
Despite assurances of external funds from Saudi Arabia and the United Arab Emirates, the IMF is asking Pakistan to “do more” to unlock its stalled loan program.
According to media reports, the meeting between Finance Secretary Hamid Yakoob and the IMF in the US remained “unfruitful” as the lender has demanded a plan to arrange $1 billion from commercial banks to unlock the IMF loan program.
The staff-level deal was supposed to be signed on February 9 but was delayed due to the IMF’s previous demands. A private news channel reported that the IMF also has objections to the government’s petrol subsidy scheme.
Earlier, the IMF had welcomed commitments made by Pakistan’s friendly countries to assist the cash-strapped country in reviving its months-long delayed $1.1 billion IMF loan tranche.
Nathan Porter, the IMF’s Mission Chief to Pakistan, had welcomed the announcement of financial assistance from Pakistan’s “key” friendly countries and said that the Washington-based Fund supports the efforts of Pakistani authorities.
Pakistan has been struggling with an economic crisis for some time now, and the IMF loan program is seen as a lifeline for the country.
Pakistan implements IMF’s conditions
The country has been implementing a series of reforms to fulfill the IMF’s conditions, including currency devaluation, revenue mobilization, and structural reforms.
However, the COVID-19 pandemic has further exacerbated Pakistan’s economic problems, and the country is in urgent need of external financing to boost its economy.
The delay in signing the staff-level agreement with the IMF is likely to have a negative impact on Pakistan’s economy, and the government must take urgent measures to address the lender’s concerns and fulfill its conditions to unlock the loan program.
The situation is developing, and further updates are expected in the coming weeks.
