Agreement with IMF, a good development for Pakistan: Hafeez Shaikh

ISLAMABAD: Federal Minister for Finance and Revenue, Dr. Abdul Hafeez Shaikh Tuesday said that the staff-level agreement reached between International Monetary Fund (IMF) and Pakistan was a a good development for the country.

In a tweet, the federal minister shared that Pakistan had reached a staff level agreement with the IMF, saying that overcoming the challenges created by the Pandemic had required concerted effort.

"I would like to share that the Government of Pakistan has reached a staff level agreement with the IMF. Overcoming the challenges created by the Pandemic has required concerted effort," he tweeted.

The minister thanked the Prime Minister for his guidance, and all my colleagues and the IMF staff for their support.

"I would like to thank the Prime Minister for his guidance, and all my colleagues and the IMF staff for their support. This is a good development for Pakistan," he added.

It is pertinent to mention here that IMF and the Pakistan reached a staff-level agreement on second to fifth reviews of country's reform program under IMF Extended Fund Facility (EFF).

"IMF staff and the Pakistani authorities have reached an agreement on a package of measures to complete second to fifth reviews of the authorities’ reform program supported by the IMF Extended Fund Facility (EFF)," said an IMF press statement issued Tuesday.

The statement was issued after the IMF team, led by Ernesto Ramirez Rigo, concluded virtual discussions with the Pakistani authorities and reached a staff-level agreement on the second to fifth reviews of the authorities’ reform program supported by the IMF 39-month Extended Fund Facility (EFF) arrangement for the amount of SDR 4,268 million (about US$6 billion).

This agreement is subject to the approval of the IMF’s Executive Board, the statement said adding the reviews’ completion would release around US$500 million.

Ramirez Rigo in the statement said that the policies and reforms implemented by the Pakistani authorities prior to the COVID-19 shock had started to reduce economic imbalances and set the conditions for improving economic performance.

Most of the targets under the EFF-supported program were on track to be met. However, the pandemic disrupted these improvements and required a shift in authorities’ priorities towards saving lives and supporting households and businesses.

To a large extent, the authorities’ response was enabled by the fiscal and monetary policy gains attained in the first nine months of FY2020.