The International Monetary Fund (IMF) urged Pakistani authorities to accelerate the pace of reforms, as the country seeks a new and larger programme with the Washington-based lender.

The IMF official stressed that more than the size of the programme, the “reform package” is going to be more crucial as Pakistan looks to reduce reliance on the lender.

Addressing a press conference on the sidelines of the IMF 2024 Spring Meetings on Thursday, Jihad Azour, Director of the Middle East and Central Asia Department at IMF, stated that the package of reform is now more important than the size of the programme.

“We saw recently that the right measures provided the right response,” he said.

“Markets reaction was positive. We saw additional inflows; reserves have been rebuilt at the level of the central bank and even growth prospects have improved.

“I think what is important at this stage is to accelerate reforms, double down on structural reforms in order to provide Pakistan with its full potential of growth.

“Yes, we have had several programmes, but the priorities are still there and therefore the Fund is ready to assist when the government asks for that.

And I think Pakistan’s bilateral partners are also looking forward to the programme to extend their additional financial support to Pakistan, he added.

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On the ongoing IMF’s $3-billion Stand-By Arrangement (SBA) inked with the Pakistani authorities last year in Summer, Jihad said the programme “allowed Pakistan to achieve a certain number of important milestones in terms of economic stability.”

He shared that the IMF’s last review was successful and will be put forward to the lender’s board, that “will end a programme that helped Pakistan address acute economic imbalances and maintain its economic stabilities”.

“Those measures also allowed Pakistan to increase its buffers,” he said.

The IMF official said the Pakistani authorities have expressed interest in a new program in order to help the country address some of the key challenges.

“And what are those challenges?

“One is to preserve macroeconomic stability and this would require continuing the work on the fiscal side in order to reduce the level of budget deficits, and strengthen the fiscal situation by improving the revenue situation, which was one of the main challenges in the past,” he said.

Jihad highlighted that increasing revenues would allow the Pakistani government not only to address its debt situation but also provide room for additional social support.

“The second pillar is the reform of the energy sector. And this is a priority that, yes, has been there for some time, but it’s still an important reform dimension for Pakistan,” he said.

“Three is to increase the potential of this economy to grow.

“Pakistan is a large economy with a large potential,” said Jihad.

“Those are the key pillars that Pakistan would need to improve its situation and the Fund is ready to support.”