Thursday, June 20, 2024

Pakistan, IMF Reach $3 Billion Standby Aid

Immigration News

Fidel Rahmati
Fidel Rahmati
Fidai Rahmati is the editor and content writer for Khaama Press. You may follow him at Twitter @FidelRahmati

Shehbaz Sharif, Prime Minister of Pakistan, said on Friday that Pakistan had reached a staff-level agreement with the International Monetary Fund on a nine-month $ 3 billion standby Arrangement.

“I am pleased to announce that Pakistan has reached a Staff-Level Agreement with the IMF on a nine-month US$3 billion Standby Arrangement,” Sharif tweeted.

According to the prime minister, the agreement will help Pakistan increase its foreign exchange reserves, enabling it to establish economic stability and set the nation on the path to long-term economic prosperity.

“This arrangement will help strengthen Pakistan’s foreign exchange reserves, enabling the country to achieve economic stability ad put the country on the path of sustainable economic growth,” he added.

After an eight-month wait, the agreement, which the IMF board must approve in July, provides some relief to Pakistan, which suffers a severe balance of payments problem and declining foreign exchange reserves.

The $3 billion funding for Pakistan over nine months is more than expected. The remaining $2.5 billion from a $6.5 billion bailout package negotiated in 2019 that expired on Friday was still pending release to the country.

In recent years, Pakistan’s economy has encountered several difficulties, including the devastating floods last year and rising commodity prices as a result of the conflict in Ukraine, according to IMF official Nathan Porter on Thursday.

“Despite the authorities’ efforts to reduce imports and the trade deficit, reserves have declined to deficient levels. Liquidity conditions in the power sector also remain acute,” Porter said in a statement.

“Given these challenges, the new arrangement would provide a policy anchor and a framework for financial support from multilateral and bilateral partners in the period ahead,” Porter added.

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