Government rejects reports on postponement of IMF deal
While refuting reports of the suspension of the International Monetary Fund (IMF) programme, Finance Minister Miftah Ismail said on Monday that the program was “on track”.
“I read all the tweets and stories on [the] The IMF program is postponed or delayed due to an anti-corruption law,” the federal minister wrote on his official Twitter account.
“Not true. The IMF program is on track,” he also wrote on the microblogging site.
Miftah was responding to a news report that claimed the IMF was calling for the revision of laws relating to the National Accountability Bureau (NAB), adding that “the government is willing to implement other financial measures, except those related to the NAB. “.
I read with amusement all the tweets and stories about the postponement or delay of the IMF program due to an anti-corruption law. There is no truth in that. The IMF program is on track. https://t.co/6c0MNvQ0g3
— Miftah Ismail (@MiftahIsmail) July 4, 2022
The Express Grandstandlate last month reported that to relaunch its stalled $6 billion lending program, the IMF had set four strict preconditions – raising electricity tariffs, the cabinet making the decision to gradually impose an oil tax of 50 rupees per liter to collect 855 billion rupees, and end the government’s role in determining oil prices.
The IMF has also asked Pakistan to set up an anti-corruption task force to review all existing laws that aimed to curb corruption in government departments, sources said.
After implementing the conditions, the IMF will present Pakistan’s request for loan tranche approval and program relaunch to its board – a process that could take another month, the sources added. .
Lily Pakistan receives IMF MEFP for 7th and 8th reviews: Miftah
In its draft Memorandum of Economic and Financial Policies (MEFP) document, the IMF proposed consolidating the two pending program reviews – the 7th and 8th – but did not indicate that it would also approve loan tranches of $2 billion.
The MEFP will form the basis of the personnel level agreement which the Pakistani authorities will now endeavor to conclude as soon as possible.
However, the finance minister said that Pakistan had received the MEFP document which showed the merger of the seventh and eighth bailout program reviews and that the country would receive a loan of $1.9 billion after their approval. He has already informed Prime Minister Shehbaz Sharif of this development.
The current IMF program shows that the approval of the 6th and 7th reviews by the IMF Executive Board should pave the way for the release of about $960 million in two loan tranches, totaling $1.9 billion. However, this calendar will be modified after the merger of the two journals.
The sources said that in its draft MEFP document, the IMF did not mention increasing the size of the loan tranche to $1.9 billion. The issue of increasing the size of the loan will now be discussed by both parties.
The finance minister said The Express Grandstand that Pakistan had requested the IMF to double the size of the loan tranche to $2 billion. He said nothing was final yet but the loan amount could be around $1.5 billion.
Pakistan has not received the full MEFP and some of the important charts would be shared by the global lender within days. Pakistan and IMF officials also recently held virtual talks to gain more clarity on the draft MEFP.
Lily Pakistan could receive up to $2 billion from IMF, PM Shehbaz says
The IMF’s decision to merge the 7th and 8th program reviews also came as a surprise to the Pakistani authorities, as no recent discussion had taken place on the subject, although Islamabad made a request for a merger during Miftah’s visit to Washington.
In the recent past, Miftah had ruled out the possibility of bludgeoning the two critics.
Previously, the IMF had also clubbed four reviews – from the second to the fifth review – but without increasing the size of the loan tranche. The IMF had given only $500 million against $2 billion in four reviews.
The existing document showed that the 7th review was for the end of December 2021 period and the 8th review was for the January to March 2022 quarter.
The sources said the MEFP indicated that the global lender could extend the scheme by June next year, but there was no explicit mention.