WASHINGTON: Pakistan and the International Monetary Fund (IMF) have reached a staff-level agreement on revival of $6 billion Extended Fund Facility (EFF) that was suspended in April this year.
“The Pakistani authorities and IMF staff have reached a staff-level agreement on policies and reforms needed to complete the sixth review under the EFF,” read a statement issued by the Fund.
“The agreement is subject to approval by the Executive Board, following the implementation of prior actions, notably on fiscal and institutional reforms. Completion of the review would make available SDR 750 million (about US$1,059 million), bringing total disbursements under the EFF to about US$3,027 million and helping unlock significant funding from bilateral and multilateral partners.
An additional SDR 1,015.5 million (about US$1,386 million) was disbursed in April 2020 to help Pakistan address the economic impact of the COVID-19 shock.”
In this sense, the goals of the government are to correct long-standing policy and structural shortcomings, restore macroeconomic stability, initiate significant foreign financial support, and promote strong and long-term growth.
The International Monetary Fund (IMF) has expressed its desire for Pakistan’s government to increase tax compliance and decrease the nation’s public debt. But as the government puts these changes into practice, Lipton said, protecting the most disadvantaged “will be an important priority.”
“This will be accomplished by investing in high-poverty areas, supporting measures for women’s economic empowerment, and significantly increasing the resources allocated to important social assistance programs.”
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