Finance Secretary, Hamid Yaqoob’s recent visit to the United States yielded no significant progress on the staff-level agreement with the International Monetary Fund.
Sources say that the IMF has not yet given a date for the agreement, while the Finance Ministry said that the IMF has demanded to meet the conditions.
According to officials, the sideline meetings in Washington could not reach a final conclusion, and assurances from Saudi Arabia and the UAE have proved insufficient.
Sources said that another $1 billion financing plan had to be given from commercial banks and the IMF was briefed in detail on the cheap petrol scheme, but the IMF has not yet agreed to the scheme providing cheap petrol scheme.
IMF seeks more funding assurances before pact on Pakistan aid
The International Monetary Fund is seeking “necessary” financing assurances from Pakistan as soon as possible to conclude a bailout pact with the South Asian nation, IMF Mission Chief to Pakistan Nathan Porter said in a statement on Saturday.
“We welcome the recent announcement of important financial support to Pakistan from key bilateral partners,” said Porter in a statement to Business Recorder.
“During the meetings between the Pakistani delegation and IMF staff and management, there was agreement on the need to maintain strong policies and secure sufficient financing to support the authorities’ implementation efforts.
“The IMF is supporting these efforts and looks forward to obtaining the necessary financing assurances as soon as possible to pave the way for the successful completion of the 9th EFF review.”
Porter’s statement did not give details on the additional financing amount but implied that the staff-level agreement could still be a few steps away for Pakistan as the country is required to arrange fresh foreign exchange inflow, according to Business Recorder.
Pakistan ready to meet the demands
The statement, which was also released to Bloomberg, coincided with a key policy statement from Prime Minister Shehbaz Sharif who on Saturday said that Pakistan would have to fulfill the IMF demands to secure the next loan tranche of the $6 billion program.
Shehbaz was speaking in Lahore where he inaugurated a flyover in Imamia Colony.
The primer said that the former government had left a “broken” agreement for him and that Pakistan would become self-reliant once the “fetters” imposed by the IMF are removed. But until then the country has to fulfill the IMF demands, he said.
An IMF delegation visited Pakistan in February this year but left the country without concluding a staff-level agreement (SLA).
Since then, government officials have repeatedly claimed that they were nearing the SLA but it never materialized.
However, Pakistan has secured financing assurances from Saudi Arabia, UAE, and China.
Government subsidies are said to be a major stumbling block in the agreement.
Speaking in Lahore on Saturday, Shehbaz Sharif said that the government spent Rs65 billion on the distribution of free flour to the poor across the country.