Finance ministry, IMF begin review of Pakistan’s standby arrangement

The finance ministry and a delegation of the International Monetary Fund (IMF) on Thursday kicked off the second and last review of Pakistan’s $3 billion standby arrangement with the body.

The ministry had said a day ago the review would be a four-day affair and hoped for a for a successful IMF staff-level agreement after the appraisal, saying that “Pakistan has met all structural benchmarks, qualitative performance criteria and indicative targets for successful completion of the IMF review.”

The last review, if successful, will release a tranche of around $1.1 billion, the ministry had said. Islamabad had secured the last-gasped rescue package last summer to avert a sovereign default.

A press release issued by the ministry today said a delegation led by IMF mission chief for Pakistan Nathan Porter called on Finance Minister Muhammad Aurangzeb today to conduct the second review.

The finance minister welcomed the delegation and expressed the government’s commitment to working with the IMF on a reform agenda for the country’s economic growth and stability.

The press release said discussions were held between both sides on overall macroeconomic indicators, government efforts on fiscal consolidation, structural reforms, energy sector viability and governance of state-owned enterprises.

Aurangzeb thanked the IMF for its continued support and hoped for productive meetings in the second review. Prime Minister Shehbaz Sharif has already directed his finance team to initiate work on seeking an Extended Fund Facility (EFF) after the standby arrangement expires on April 11.

The lender has said it will formulate a medium-term programme if Islamabad applies for one. The government has not officially stated the size of the additional funding it is seeking through a successor programme from the fund.