ISLAMABAD – Stand-By Arrangement with Pakistan is aimed at supporting the efforts of stabilizing the economy and fulfilling current balance of payments needs, said Julie Kozack, the International Monetary Fund’s (IMF) Director of Strategic Communications.
Talking to the newsmen last day, she said that a relatively short nine-month SBA provides time for implementation of required policies to strengthen domestic and external economic situation.
When asked whether short-term program will be enough for Pakistan to come out of prevailing economic crises, Kozack said that there is a need of reforms over a medium-term to support the required economic transformations, to strengthen inclusive growth and create an environment conducive to renewed private capital inflows.
IMF official said that policy implementation in letter and spirit is a key for success of the program. She said that the IMF is ready to work with Pakistan on efforts to restore economic stability and sustainability. She warned that policy implementation will remain a key to the success of SBA and ultimately to aid and support the people of Pakistan.
Pakistan has managed to secure a new nine-month SBA with immediate disbursement of first tranche of $1.2 billion to the State Bank of Pakistan last Thursday while the remaining $1.8 billion is subject to two more reviews, in November 2023 and February 2024.
The IMF arrangement extends Pakistan’s commitment into the second half of fiscal year 2023-24 when there will be a change of government around the time of the second review.
The IMF has taken assurance from political parties which can form the government after next elections including Imran Khan led Pakistan tehreek-e-Insaf before the Executive Board meeting to continue the reform process committed to the lender.
Before the release of first tranche of $1.2 billion under the SBA, Saudi Arabia and United Arab Emirates have deposited $2 billion and $1 billion respectively to the SBP account. These payments have given a much-needed boost to the country facing economic turmoil due to dollar shortage and high inflation.
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