Pak-IMF talks move ahead

Pakistan Observer - - FRONT PAGE - MIAN ARSHAD

ISLAMABAD—The on­go­ing talks between Pak­istan and In­ter­na­tional Mone­tary Fund (IMF) for the 11th review of ex­tended funds fa­cil­ity (EFF) are pro­gress­ing for­ward pos­i­tively in Dubai.

The cur­rent review, it may be added is the sec­ond last of a to­tal of 12 re­views un­der the 36-month pro­gramme, sup­ported by an EFF ar­range­ment ap­proved in 2013.

With the suc­cess­ful con­duct of this review, Pak­istan will be in a po­si­tion to en­sure the in­ter­na­tional fi­nan­cial in­sti­tu­tions about the im­prove­ment in eco­nomic pro­file which will def­i­nitely pave way for flux of in­ter­na­tional in­vest­ment in the coun­try.

Talks be­gan on May 02 and sched­uled to be con­cluded on Wed­nes­day; how­ever, now it will come to con­clu­sion today (Thurs­day) evening. Fi­nance Sec­re­tary Dr. Waqar Ma­sood had been head­ing Pak­istani del­e­ga­tion in both the tech­ni­cal and pol­icy level talks.

The Gover­nor State Bank (SBP) and Chair­man Fed­eral Board of Rev­enue (FBR) along with teams of their re­spec­tive in­sti­tu­tions had also been ac­tively par­tic­i­pat­ing in all the rounds of the talks.

How­ever, ac­cord­ing to Fi­nance Min­istry, Fi­nance Min­is­ter Ishaq Dar, Wed­nes­day, joined Pak­istan del­e­ga­tion for talks with the IMF team for the 11th review un­der the Ex­tended Fund Fa­cil­ity (EFF).

Fi­nance Min­is­ter led the Pak­istan del­e­ga­tion five suc­cess­ful rounds of talks by Wed­nes­day evening with talks pro­gress­ing pos­i­tively.

On the other hand a well placed of­fi­cial source told Pak­istan Ob­server here that af­ter ten days hec­tic rounds of ne­go­ti­a­tions, it was quite clear that Pak­istan would suc­cess­fully con­clude the on­go­ing ne­go­ti­a­tions for 11th review.

It is just be­cause of the fact that Pak­istan’s eco­nomic pro­file has im­proved sig­nif­i­cantly as well as Pak­istani ne­go­tia­tors have pre­sented a fact based pre­sen­ta­tions in be­fore the IMF team. Al­most all the eco­nomic in­di­ca­tors are pos­i­tive and in­ter­na­tional rat­ing agen­cies are por­tray­ing Pak­istan’s eco­nomic progress in a pos­i­tive man­ner .

En­hanced vol­ume of for­eign ex­change re­serves, con­fi­dence re­posed by in­ter­na­tional in­vest­ment or­ga­ni­za­tions in eco­nomic pos­i­tive eco­nomic in­di­ca­tors as well as keen in­ter­ests shown by Chi­nese and other coun­tries’ in­vestors in re­cent in­vest­ment con­fer­ences are sup­port­ive tools for Pak­istani team.

The source said that ma­jor fo­cus of the govern­ment in cur­rent round of talks with IMF was on fi­nal­iza­tion of fed­eral and pro­vin­cial bud­gets for the fis­cal year 2016-17. In this re­gard, Fi­nance Min­istry had shared bud­get strat­egy pa­per for 2016-17 with the IMF.

The Fi­nance Min­istry is at ease with most of the bench­marks and per­for­mance in­di­ca­tors, ex­cept for the set­back to the pri­vati­sa­tion agenda that has been a ma­jor con­cern for the IMF. The govt also needs to col­lect Rs 760bn rev­enue in the fi­nal two months of the fis­cal year 2015-16 to achieve the rev­enue col­lec­tion tar­get.

An Ex­tended Fund Fa­cil­ity with IMF pro­vides as­sis­tance in sup­port of com­pre­hen­sive pro­grams that in­clude poli­cies of the scope and char­ac­ter re­quired to cor­rect struc­tural im­bal­ances over an ex­tended pe­riod. It has a com­par­a­tively longer re­pay­ment pe­riod of 4½–10 years, with re­pay­ments in twelve equal semi-an­nual in­stal­ments.

Pak­istan en­tered into an ex­tended fund fa­cil­ity (EFF) pro­gram with IMF on Septem­ber 4, 2013. It is a 36-month ex­tended ar­range­ment un­der the Ex­tended Fund Fa­cil­ity (EFF) for $6.64 bil­lion, 425 per­cent of quota). First tranche $544.5 mil­lion, 34.8 per­cent of quota) be­came avail­able on Septem­ber 6, 2013, and the re­main­der would be evenly phased there­after sub­ject to quar­terly re­views.

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