The International Monetary Fund (IMF) has completed the second and final review of Pakistan’s economic reform program under the Stand-By Arrangement (SBA). This decision allows for an immediate disbursement of $1.1 billion, bringing the total disbursements under the arrangement to $3 billion.
The SBA, approved in July 2023, aimed to address domestic and external imbalances, provide financial support, and implement necessary fiscal adjustments. The program focused on fiscal adjustment, protection of social spending, buffering external shocks, disinflation, and structural reforms in areas such as the energy sector, state-owned enterprises (SOEs), and climate resilience.
The economic reforms have led to improvements in macroeconomic conditions, including a projected 2% growth in FY24, a strengthening fiscal position with a primary surplus achieved ahead of projections, declining inflation, and increased gross reserves.
Antoinette Sayeh, Deputy Managing Director and Chair of the IMF Executive Board, emphasized Pakistan’s progress in restoring economic stability but urged continued efforts in sound macroeconomic policies and structural reforms to foster stronger, inclusive, and sustainable growth. Fiscal sustainability, revenue mobilization, energy sector reforms, monetary policy, foreign exchange market functioning, and financial stability were highlighted as key areas for ongoing focus.