IMF okays Pakistan's initial review, paving the way for $700 million disbursement
The Executive Board of the International Monetary Fund (IMF)
has granted approval for a $700 million loan tranche to Pakistan following the
successful completion of the first review of the country's economic reform
program supported by the IMF's Stand-By Arrangement (SBA).
The Board's endorsement paves the way for an immediate
disbursement of SDR 528 million (equivalent to approximately US$ 700 million),
bringing the total disbursements under the SBA to US$ 1.9 billion. The
agreement, reached between IMF staff and Pakistani authorities on November 15,
was subject to approval by the IMF's Executive Board.
IMF
adjusts Pakistan's foreign loan requirement to $25 billion
A statement from the Finance Ministry highlighted that the
completion of the first review by the IMF's Executive Board, coupled with the
disbursement of 528 million in special drawing rights, has now totaled
disbursements under the SBA to $1.9 billion.
In response to the staff-level agreement with the IMF,
Pakistan has experienced an upswing in inflows from international financial
institutions over the past two weeks, with a total of $1.2 billion received.
These inflows have contributed to an increase in the country's foreign exchange
reserves, reaching $13.220 billion as of December 29, 2023. The breakdown of
the foreign reserves reveals $8.221 billion held by the State Bank of Pakistan
and $4.999 billion held by commercial banks.
IMF
forecasts ongoing need for substantial loans and grants in Pakistan
Furthermore, the World Bank and Asian Development Bank have
recently extended financial support to Pakistan. The World Bank's Board of
Executive Directors approved $350 million in financing for the Second Resilient
Institutions for Sustainable Economy (RISE-II) Operation, focusing on
strengthening fiscal management and promoting competitiveness for sustained and
inclusive economic growth. Meanwhile, the Asian Infrastructure Investment Bank
sanctioned $250 million for the Second Resilient Institutions for Sustainable
Economy (RISE-II) development policy financing.
In parallel, the Asian Development Bank (ADB) endorsed three
projects totaling $658.8 million, aimed at aiding Pakistan in achieving its
objectives of more inclusive and sustainable growth and development.
Source: The Nation