PM Sharif and IMF chief meet in Riyadh, discuss Pakistan’s new loan program

F.P. Report

RIYADH : Pakistan Prime Minister Shehbaz Sharif on Sunday met with International Monetary Fund (IMF) Managing Director Kristalina Georgieva in Riyadh, where the two figures discussed a new loan program for the cash-strapped South Asian country, Sharif’s office said.

The meeting between PM Sharif and the IMF managing director took place on the sidelines of a two-day World Economic Forum (WEF) summit on global collaboration, growth and energy in the Saudi capital on April 28-29.

Sharif thanked Georgieva for her support to Pakistan in securing a $3 billion IMF loan program last year that is due to expire this month. The IMF executive board is expected to meet on Monday to decide on the disbursement of the final tranche of $1.1 billion to Pakistan.

“MD IMF shared her institution’s perspective on the ongoing program with Pakistan, including the review process,” PM Sharif’s office said in a statement.

“Both sides also discussed Pakistan entering into another IMF program to ensure that the gains made in the past year are consolidated and its economic growth trajectory remains positive.”

Sharif informed the IMF chief that his government was fully committed to put Pakistan’s economy back on track, according to the statement.

He said he had directed his financial team, led by Finance Minister Muhammad Aurangzeb, to carry out structural reforms, ensure strict fiscal discipline and pursue prudent policies that would ensure macro-economic stability and sustained economic growth.

Pakistan secured the $3 billion IMF program in June last year, which helped it avert a sovereign default. Islamabad says it is seeking a loan over at least three years to help achieve macroeconomic stability and execute long-overdue reforms.

Finance Minister Aurangzeb has said Islamabad could secure a staff-level agreement on the new program by early July, though he has declined to detail what size of the program it seeks. If secured, it would be Pakistan’s 24th IMF bailout.

The $350 billion South Asian economy faces a chronic balance of payments crisis, with nearly $24 billion to repay in debt and interest over the next fiscal year — three-time more than its central bank’s foreign currency reserves.

Pakistan’s finance ministry expects the economy to grow by 2.6 percent in the fiscal year ending in June, while average inflation for the year is projected to stand at 24 percent, down from 29.2 percent the previous fiscal year.

Courtesy: arabnews