IMF to meet major political parties of Pakistan to seek support for USD 3 billion Standby Agreement

The IMF reached a staff-level pact with Pakistan on a USD 3 billion Standby Arrangement last week

The IMF reached a staff-level pact with Pakistan on a USD 3 billion Standby Arrangement last week
The IMF reached a staff-level pact with Pakistan on a USD 3 billion Standby Arrangement last week

IMF goes off track, holds direct talks with Pakistan’s political leaders

The International Monetary Fund (IMF) is “in the process” of meeting representatives from Pakistan’s major political parties, including Imran Khan’s party, to “seek assurances of their support for key objectives and policies” under the new USD 3 billion bailout deal, its top official in the country said on Friday. Pakistan secured a badly needed USD 3 billion Standby Arrangement (SBA) from the IMF last Friday, giving the cash-strapped South Asian economy a much-awaited respite as it teeters on the brink of default.

The Executive Board of the IMF will meet on July 12 to review the USD 3 billion SBA for Pakistan, the staff-level pact for which was finalized last week. “The IMF staff are in the process of meeting with representatives of the major political parties in Pakistan, including PML-N (Pakistan Muslim League-Nawaz), PPP (Pakistan Peoples’ Party), and PTI (Pakistan Tehreek-e-Insaf) to seek assurances of their support for the key objectives and policies under a new IMF-supported programme ahead of the approaching national elections,” Esther Perez Ruiz told Dawn newspaper.

“An IMF team will call on (PTI) Party Chairman Imran Khan at Zaman Park this afternoon. Both PTI’s economic team and the IMF team will join, in person and virtually, to take part in the discussions,” PTI’s Secretary General Central Punjab Hammad Azhar tweeted. The economic crisis-hit country was absent from an earlier schedule released in June, igniting speculation that the global lender was not going to release funds from an earlier programme that expired on June 30.

On June 29, the IMF and Pakistan reached a standby Arrangement (SBA) to ease the country’s financial crisis. The nine-month SBA, if approved, will bring USD 3 billion or 111 percent of the cash-strapped country’s IMF quota. The previous Extended Fund Facility expired on June 30, with the 9th, 10th, and 11th reviews pending. The SBA, subject to the IMF board approval, offers much-needed relief to the country grappling with a severe balance of payments crisis and declining foreign exchange reserves.

Earlier on Friday, ousted Prime Minister and PTI chief, Khan said in Lahore during a court hearing pertaining to May 9 riots that he would be meeting the IMF delegation. When asked about joining the investigation in the “Black Day” violence case at 4 pm on Friday, the cricketer-turned-politician said he was unavailable to join the probe as he was scheduled to meet with a delegation from the IMF. Pakistan’s economy has been in a free fall mode for the last many years, bringing untold pressure on the poor masses in the form of unchecked inflation.

Apart from the political turmoil, the country has also faced several challenges in recent times, including devastating floods last year and commodity price hikes following the war in Ukraine. Over 1,500 people were killed last year during floods in Pakistan that destroyed millions of homes, wiped out swathes of farmland, and caused billions of dollars in economic losses.

[with PTI inputs]

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