- Finance minister tweets development
- Approval paves way for over $1-billion disbursement
The International Monetary Fund’s (IMF) Executive Board has given its stamp of approval on Pakistan’s sixth review of the Extended Fund Facility (EFF), said Finance Minister Shaukat Tarin in a tweet on Wednesday night, a development that paves way for the next tranche of the $6-billion programme.
"I am pleased to announce that IMF Board has approved the 6th tranche of their programme for Pakistan," he tweeted. An IMF statement on Pakistan's sixth review has yet to be issued.
The development comes after the Washington-based lender had made a staff-level agreement in November last year.
Completion of the review has now made available SDR 750 million (about $1,059 million), taking total disbursements under the EFF to about $3,027 million.
Pakistan and the IMF had reached a staff-level agreement on November 21, 2021. The agreement was subject to approval by the Executive Board, following the implementation of prior actions, mainly on fiscal and institutional reforms.
One of the prior actions was passage of the State Bank of Pakistan (SBP) (Amendment) Bill, 2021. The bill was passed by Senate on Friday. Another prior action was the withdrawal of sales tax exemptions to the tune of Rs343 billion, which the government enforced through the Finance (Supplementary) Act, 2022 from January 16, 2022.
"IMF board approval is a stamp of confidence on the government policies by the IMF," Samiullah Tariq, Head of Research and Development at Pak-Kuwait Investment Company, told Business Recorder. "This would unlock funding from numerous sources to refinance Pakistan's debt as well as build the country's import cover."