Inching closer: Pakistan receives combined IMF targets for 7th, 8th reviews

ISLAMABAD: Pakistan has received combined economic and financial targets for the seventh and eighth reviews of its International Monetary Fund (IMF) bailout programme, Finance Minister Miftah Ismail said on Tuesday.

On Twitter, Miftah said the government had received the lender’s Memorandum of Economic and Financial Policies (MEFP) for both reviews, following meetings last week between the two sides.

Earlier, Business Recorder had reported that IMF will likely send the draft of the MEFP to Pakistani authorities on Monday — a key step to indicate that the two parties have reached an agreement.

The government wants to conclude an agreement with the monetary watchdog for the revival of the $6 billion program before the approval of Federal Budget 2022-23. It needs to get the budget approved by June 28.

The IMF programme is widely seen as crucial for Pakistan’s economy that has struggled with high inflation and a widening current account deficit. The deterioration has caused the rupee to hit all-time lows several times during the year, with over 15% depreciation this calendar year alone.

Last week, Pakistan and IMF made progress on the budget measures for 2022-23, with additional policy actions committed by Islamabad to revive the stalled Extended Fund Facility (EFF) including generating more taxes and increasing petroleum levy from July 1.

The agreement led to the imposition of the ‘super tax’ on 13 sectors.