IMF’s Executive Board meeting on Pakistan set for July 12

The International Monetary Fund (IMF) Executive Board meeting on Pakistan has been set for July 12, the lender confirmed to journalists via email on Wednesday night.

The Fund is set to discuss a nine-month Stand-by Arrangement (SBA) for Pakistan as the previous Extended Fund Facility (EFF) expired on June 30.

On June 30, IMF announced that its staff and Pakistani authorities reached an agreement on policies to be supported by a $3-billion, nine-month SBA.

A new stand-by arrangement with the IMF: here are some key points

The staff-level agreement is subject to approval by the IMF Executive Board.

“The new SBA builds on the authorities’ efforts under Pakistan’s 2019 EFF-supported programme which expires end-June,” Nathan Porter, IMF Mission Chief to Pakistan, was quoted as saying in the press release on the day the Extended Fund Facility expired.

The new IMF arrangement, seen as a massive positive for the government and the economy reeling from crisis, extends Pakistan’s commitment with the lender well into the second half of fiscal year 2023-24, and is also an upgrade from the earlier expectation that the country would receive $1.1 billion at the conclusion of the ninth review.

The development comes at a time when Pakistan’s economy is reeling from crisis with foreign exchange reserves at only a month of import cover. The depleting level prompted Pakistan’s central bank to impose import restrictions, much to the dismay of industries heavily reliant on inward shipments to produce goods in the country.

While the State Bank of Pakistan (SBP) removed restrictions, many believe that imports would not truly begin until Pakistan secures lines of credit that would boost foreign exchange reserves.