No move yet by GoP: IMF, World Bank to discuss steps to support Pakistan's economy, says Rice

Steps to support the economy of Pakistan would be discussed during the forthcoming IMF-World Bank annual meeting. Gerry Rice, International Monetary Fund (IMF) Acting Director External Relations, stated this in Washington. The press briefing attributed the following statement to Rice.
"The Pakistani authorities, officials, will be here during the annual meetings, and we can expect that discussions will take place as to next steps on how to move forward in terms of helping support the Pakistan economy". Sources told Business Recorder here on Friday that the Pakistan government has so far not requested for reactivation of the existing stalled Stand By Arrangement (SBA), that would be signalled by the request for a fifth review mission. If no request is received by the end of September, the SBA would be suspended.
A 34-month $11.3 billion SBA was originally approved by the IMF's Executive Board on November 24, 2008, augmented on August 7, 2009, and extended by nine months in December 2010. An amount equivalent to SDR 5.1685 billion (about $7.61 billion) was originally approved on November 24, 2008. On August 7, 2009 the SBA was augmented to SDR 7.2359 billion (about US $10.66 billion) and extended through December 30, 2010. Following the completion of the fourth review in May 2010, disbursements under the arrangement reached SDR 4.936 billion.
Sources said that the concerned Pakistani authorities are making essential arrangements on the sidelines of the annual meetings for fiscal year 2010-11 and relevant data has already been shared with IMF. "If Pakistan goes for a new loan programme with IMF, the pre-loan conditions of the Fund may include implementation of tax reforms in the country aimed at widening the tax base, the power sector reforms to reduce the Power Sector Circular Debt and the limitation of government borrowing from the Central Bank", sources said.
The reason why the country may opt to enter a new loan programme with IMF is that the country is unlikely to be able to meet its legal obligation to pay $1.4 billion (120 billion rupees) to the Fund in calendar year 2012, as repayment of $7.2 billion SBA begins without borrowing.