Islamabad, The International Monetary Fund (IMF) and Pakistani authorities have reached a significant staff-level agreement under Pakistan’s Stand-By Arrangement (SBA). This agreement, pending approval by the IMF’s Executive Board, is pivotal for Pakistan’s economic stability and growth, with a particular focus on overhauling the energy sector.
According to Zameen.Com, the IMF’s approval would grant Pakistan access to Special Drawing Rights (SDR) worth 528 million, equivalent to approximately USD 700 million. Nathan Porter, the IMF team leader, emphasized the importance of this agreement in supporting Pakistan’s economic stabilization program. He noted that upon board approval, Pakistan would receive about USD 700 million, totaling almost USD 1.9 billion in disbursements under the program.
The SBA’s stabilization policies have already laid the groundwork for Pakistan’s emerging economic recovery. Key factors contributing to this recovery include international support, improved confidence, execution of the FY24 budget, and adjustments in energy prices. Despite the positive outlook, Porter cautioned against external risks like geopolitical tensions and fluctuating commodity prices.
The SBA’s priorities include fiscal consolidation, expanding social safety nets, energy sector reforms, market-driven exchange rates, and strengthening financial sector resilience. The IMF team praised Pakistan’s dedication to these reforms and expressed appreciation for the cooperation from Pakistani authorities, the private sector, and development partners during their mission.