Prime Minister Shehbaz Sharif said on Friday that the International Monetary Fund’s (IMF) Stand-By Arrangement (SBA) with Pakistan will help strengthen the country’s foreign exchange reserves’ position, and enable it to achieve economic stability.
The premier thanked IMF Managing Director Kristalina Georgieva and her team for their “cooperation and collaboration, especially during the course of the last week”.
His remarks come following the IMF’s announcement earlier on Friday that its staff and Pakistani authorities have reached an agreement on policies to be supported by a $3-billion, nine-month SBA.
The staff-level agreement is subject to approval by the IMF Executive Board, with its consideration expected by mid-July.
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“The new SBA builds on the authorities’ efforts under Pakistan’s 2019 EFF-supported program 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.
Finance Minister Ishaq Dar also took to Twitter and shared the IMF’s press release.
Minister for Planning, Development and Special Initiatives Ahsan Iqbal said the country should work to implement the government’s ‘5Es framework’ “to make the economy strong and sustainable by developing it to its full potential.’’
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Information Minister Marriyum Aurangzeb said the PM and Dar would hold an “important press conference” at 4pm on Friday regarding the IMF deal.
Michael Kugelman, South Asia Institute Director at The Wilson Centre, noted that Islamabad had “waited until the very final hour to take the (politically risky) fiscal policy steps that the IMF had been hoping to see for months.”
“If it had taken those steps earlier, much of the drama and fraught negotiations of recent months likely wouldn’t have had to play out,” he said, adding that ’’In all likelihood, when PM Sharif met the IMF director in Paris last week, she delivered a ‘now or never’ warning to him. That message appears to have resonated and he appears to have delivered.“