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ISLAMABAD: The International Monetary Fund’s Executive Board is scheduled to meet on January 12 with consideration of Pakistan - 2021 Article IV Consultation, Sixth Review under the Extended Fund Facility (EFF), and Requests for Waivers of Nonobservance of Performance Criteria and Rephasing of Access”.

The IMF Executive Board calendar updated on its website shows that its meeting has been scheduled for January 12, 2022, and the agenda includes, Pakistan - 2021 Article IV Consultation, Sixth Review under the Extended Arrangement, under the Extended Fund Facility, and Requests for Waivers of Nonobservance of Performance Criteria and Rephasing of Access”.

Completion of the review would make available SDR 750 million (about $1,059 million), bringing total disbursements under the EFF to about $3,027 million. Pakistan and the IMF had reached a staff-level agreement on policies and reforms needed to complete the sixth review under the $6 billion Extended Fund Facility (EFF) and issued a press statement on November 21, 2021.

The staff-level agreement is subject to approval by the Executive Board, following the implementation of prior actions, mainly on fiscal and institutional reforms.

6th review of EFF to be presented to IMF board on Jan 12

The government has already tabled the Finance (supplementary) Bill and the State Bank of Pakistan (SBP) Amendment Bill 2021 in the parliament as the prior conditions needed for the sixth review of the $6 billion Extended Fund Facility (EFF) to get cleared by the IMF’s executive board.

The government has committed to the IMF that Pakistan will complete all “prior actions” before the board of directors meeting to approve the revival of $6bn EFF.

EDITORIALS: Confusion on IMF prior conditions

Under those prior actions, the government, through the supplementary finance bill, will make fiscal adjustment during the remaining part of the current fiscal year through a 22 per cent cut in development funds, about Rs343 billion worth of withdrawal of tax exemptions with a revised tax target of Rs6.1 trillion and increase in petroleum levy on major petroleum products by Rs4 per litre per month. The government has already increased electricity prices.

Copyright Business Recorder, 2022

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