Prime Minister Shehbaz Sharif on Friday said he is hopeful that the crucial International Monetary Fund (IMF) programme would resume “this month”, a statement that comes after the lender confirmed its mission will arrive in Islamabad at the end of January.
“I am hopeful that we will reach an agreement with the IMF this month,” said the premier, while addressing the inauguration of the Green Line Express Train service in Islamabad.
“Following the agreement, multilateral and bilateral institutions will also come on board with Pakistan.enter link description here“These are difficult times, but the coalition government is working hard, and I am hopeful that the tough times will pass,” he added.
His statement comes as the IMF said its mission will visit Pakistan from January 31-February 9 to continue discussions for the 9th review under the Extended Fund Facility (EFF).
This was confirmed by IMF Resident Representative Esther Perez Ruiz to Business Recorder on Thursday, a day when the rupee also plunged nearly 10% against the US dollar in the inter-bank market. The next day, the rupee depreciated another 2.7%.
The IMF official stated that the mission will focus on policies to restore domestic and external sustainability, including to strengthen the fiscal position with durable and high-quality measures while supporting the vulnerable and those affected by the floods; restore the viability of the power sector and reverse the continued accumulation of circular debt; and reestablish the proper functioning of the forex market, allowing the exchange rate to clear the FX shortage.
Pakistan is desperately looking to convince the lender to resume its bailout as foreign exchange reserves held by the State Bank of Pakistan (SBP) dropped a massive $923 million to a mere $3.7 billion, data released on Thursday showed. This is the lowest level of SBP-held reserves since February 2014.
Meanwhile, PM Shehbaz on Friday said that Pakistan is standing at a crossroads where it needs to save every penny.
“We have set up a priority list for imports while keeping foreign exchange reserves in mind,” he added.
Alarm bells: SBP-held foreign exchange reserves plunge $923mn, now stand at mere $3.7bn
Addressing the event, Federal Minister for Finance and Revenue Ishaq Dar congratulated the Ministry of Railways for reviving the Green Line.
He said that the ML-1 project was originally conceived as part of the China-Pakistan Economic Corridor (CPEC), and would currently cost $11-$12 billion. “This is the legacy of the previous government, which this government inherited,” he said.
Talking about Pakistan’s financial health, Dar said that the Pakistan Muslim League-Nawaz (PML-N) government revived the economy during its last stint in power in 2013.
“In a span of three years, the economy was totally turned around,” he said.
“It is unfortunate that after five years, we are standing in this predicament, which needs to be thoroughly investigated,” said Dar.
He said that PM Shehbaz Sharif has received a legacy of “total collapse state of affairs.”
“However, we are assisting PM Shehbaz to take Pakistan out of this quagmire,” he said, adding that the country would survive.
Earlier this week, Shehbaz Sharif reinforced the government’s wish to complete the IMF programme.
“We have given the IMF a clear message that we want to complete the ninth review. We are ready and want to sit down regarding your conditions so that it (ninth review) can be concluded and Pakistan can move forward,” the PM had said in an address.