Pakistan's Last-Ditch Effort: Urgent IMF Meeting to Salvage Program

Pakistan's Plea for an Urgent IMF Meeting to Revive Program Hangs in the Balance

Pakistan is actively pursuing a crucial meeting between Prime Minister Shehbaz Sharif and IMF Managing Director Kristalina Georgieva to discuss the revival of the International Monetary Fund (IMF) program. With hopes diminishing for program renewal, Pakistan's government is making efforts to arrange a meeting on the sidelines of the New Global Financing Pact Summit in Paris from June 22-23. The imminent expiration of the $6.7 billion Extended Fund Facility (EFF) program on June 30 adds urgency to the situation. The ninth review, which has been pending since November 2022, seems increasingly elusive.

The Significance of the Meeting

An official emphasized the critical nature of the proposed meeting, stating that without it, the revival of the IMF program was virtually impossible. The outcome of the meeting could potentially brighten the prospects of program renewal. However, if the request for the meeting is turned down, the chances of reviving the program diminish significantly.

The Lingering Ninth Review

Since November 2022, the ninth review of the Extended Fund Facility program has remained elusive. Despite the IMF's review mission taking place from January 31 to February 9, 2023, the signing of the Staff Level Agreement (SLA) did not materialize. The IMF had set forth certain prior actions that have yet to be fulfilled, leading to the current impasse.

Previous Attempts at Reconciliation

Efforts have been made to bridge the gap between Pakistan and the IMF. Minister for Finance Ishaq Dar engaged in virtual meetings with IMF officials in April, aiming to reach a consensus. However, these attempts failed to yield a breakthrough. Prime Minister Shehbaz Sharif also had a telephone conversation with the IMF Managing Director to discuss the revival of the stalled program, but no substantial progress was achieved.

Disagreements Over Budget 2023-24

During negotiations, IMF President Chief Esther Perez Ruiz issued a statement expressing criticism of the budget for the fiscal year 2023-24. In response, the Ministry of Finance released a statement, and both sides expressed their commitment to remain engaged for the conclusion of the pending ninth review.

International Support and Assistance

In light of the challenges faced by Pakistan, Finance Minister Ishaq Dar held a virtual meeting with Britain's Minister of State in the Foreign, Commonwealth & Development Office, Andrew Mitchell. Mitchell conveyed his condolences for the loss of lives in a recent boat capsizing incident in Greece, while Dar expressed gratitude for the support. They both recognized the global issue of illegal human trafficking and the need for immediate action. Mitchell assured Pakistan of the continuous support and assistance of the British government in its pursuit of economic stability through policy reforms.

As Pakistan's IMF program expiration date draws near, the government is making every effort to arrange a crucial meeting between Prime Minister Shehbaz Sharif and IMF Managing Director Kristalina Georgieva. The outcome of this meeting could determine the fate of the $6.7 billion Extended Fund Facility program. With the ninth review remaining unresolved since November 2022, hopes for program revival are diminishing. The engagement and support of the international community, including the British government, are vital in Pakistan's pursuit of economic stability and policy reforms.