IMF approves $1.1bn loan tranche for Pakistan
Business
Approval comes a day after PM Shehbaz met IMF Managing Director Kristalina Georgieva
- The payment will be the last installment of $3 billion Stand-By Arrangement with IMF
- Pakistan also aspires to funding under climate financing
ISLAMABAD (Dunya News) – The International Monetary Fund (IMF) on Monday approved disbursement of $1.1 billion tranche, concluding the second bailout package in eight years.
However, this successful completion has come at a steep cost, resulting in severe inflation and a decelerating economy.
The board met in Washington and completed the second review. It is learnt that all board members, except India, favoured the last installment for Pakistan.
Sources say Pakistan is expected to receive the loan payment later this week. This payment will be the third and final installment of a $3 billion Stand-By Arrangement (SBA) with the IMF, which was agreed upon last summer to prevent a sovereign default and is set to expire this month.
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The latest update follows a meeting between Prime Minister Shehbaz Sharif and IMF Managing Director Kristalina Georgieva in Riyadh on Sunday.
In his first meeting with the IMF chief since being re-elected, PM Shehbaz discussed the possibility of Pakistan entering a new programme with the IMF.
Pakistan is now hoping for a bigger loan programme worth $6bn to $8bn spanning over three to four years, as an IMF team is expected to arrive in Islamabad some time next month to discuss the terms and conditions.
It is not just the Extended Fund Facility (EFF), with Pakistan also aiming at getting additional funding under climate financing – a request yet to be approved but will be deliberated upon during the upcoming talks.
