The International Monetary Fund (IMF) and Pakistan are continuing discussions for a bailout package. This was stated by Director Communication Department IMF, Gerry Rice, during a media briefing. Rice said that during annual meetings in October last, Pakistan's Finance Minister Asad Umar made a formal request for financial assistance from the IMF.
"Since then we have had a staff team visit Islamabad following that request. And where we stand is that IMF staff is continuing discussions with the Pakistani authorities, with our counterparts, toward reaching an understanding on policy priorities, on reforms to stabilise the economy and lay the foundations for sustainable and inclusive growth. So that is where we are. We've had the formal request for financial assistance, we followed up with that and the discussions continue," Rice added.
During his last press conference, Rice had stated that IMF will conduct a proper debt sustainability analysis of Pakistan before granting it a bailout package. Clearly debt transparency is essential to conduct proper analysis of the sustainability of a country's debt. "That is what the IMF does when we are going into a programme with our member countries. So that will be the case in Pakistan. But one of the things that we do in every programme is to have a very detailed debt sustainability analysis to ensure that indeed the country's debt profile is sustainable. So that kind of information and that level of detail will be available at such times as we reach conclusions on the discussions and go forward with the programme," Rice had added.
However, Fitch Solutions in its latest report stated that the latest round of Chinese largesse has given Islamabad confidence to snub the IMF's more stringent requirements for obtaining funds. "However, if Pakistan experiences acute signs of a currency crisis over the coming months, we would not be surprised to see talks between Pakistan and the IMF resume," it added.
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