IMF announces agreement with Pakistan to disburse $1.1 billion
Pakistan and the International Monetary Fund (IMF) have reached a staff-level agreement aimed at providing much-needed financial support to the debt-laden South Asian nation.
This agreement, subject to approval by the IMF's board, will see the disbursement of 1.1 billion US dollar to bolster Pakistan's economy, announced the global lender on Wednesday.
The funds represent the final installment of a $3 billion rescue package secured by Pakistan last summer, effectively averting a sovereign debt default. However, Islamabad continues to grapple with economic challenges and is actively seeking additional long-term assistance.
Confirming the agreement, the IMF stated, "The IMF team has reached a staff-level agreement with the Pakistani authorities on the second and final review of Pakistan's stabilization program." This development marks a crucial step forward in Pakistan's ongoing efforts to stabilize its economy and foster sustainable growth.
Finance Minister Muhammad Aurangzeb of Pakistan had previously indicated the nation's intention to pursue further long-term financial support. The IMF acknowledged Pakistan's interest in such an arrangement, noting that it stands ready to formulate a medium-term program should Islamabad choose to apply for one.
Reports from Bloomberg in February suggested that Pakistan was preparing to request a new loan of at least $6 billion from the IMF. Such additional funding would be instrumental in addressing the pressing economic challenges faced by the country.
Pakistan's economy has been under considerable strain, characterized by low reserves, a balance of payment crisis, soaring inflation rates, policy interest rates at historic highs, and significant depreciation of the local currency. Despite these challenges, the IMF agreement offers a glimmer of hope, providing a vital lifeline for Pakistan's economic stability and growth prospects.
With expectations of modest growth projected for the coming year, the IMF agreement signals a renewed commitment to addressing Pakistan's economic vulnerabilities and laying the groundwork for a more resilient and prosperous future.
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