IMF director confident deal with Pakistan to be signed soon

ISLAMABAD: IMF’s Director Middle East and Central Asian Department Jihad Azour has expressed the confidence that Staff Level Agreement (SLA) with Pakistan will be signed soon followed by the IMF Board’s approval. The IMF director made these remarks during a Zoom meeting with Finance Minister Ishaq Dar on Wednesday, according to an official press statement of the Ministry of Finance.

Azour hoped that Pakistan would continue towards its progress on reforms in various sectors and complete the IMF programme in time also IMF will play a positive role in bringing economic stability to Pakistan.

Meanwhile, Pakistan has not yet received confirmation on additional $1 billion deposits from the United Arab Emirates (UAE), which poses the last stumbling block in the way of striking the staff-level agreement

Federal Minister for Finance and Revenue Senator Ishaq Dar attended the IMF/World Bank Spring meetings through Zoom from Islamabad with a high-level IMF team headed by Jihad Azour, Director Middle East and Central Asia Department (MCD), on Wednesday. Minister of State for Finance and Revenue Dr Aisha Ghous Pasha, SAPM on Finance Tariq Bajwa and SAPM on Revenue Tariq Mehmood Pasha also attended the meeting. The Ambassador of Pakistan to the USA, Masood Ahmad Khan, SBP Governor Jamil Ahmad, Secretary Finance and Secretary EAD attended the meeting in person.

The two sides discussed the progress of the ongoing IMF programme, particularly talks held with the IMF Mission during their visit to Pakistan and the implementation of prior actions. Ishaq Dar said that due to important domestic commitments, the prime minister had asked him to stay in Pakistan due to which he had to cancel his scheduled visit to Washington, DC. He apprised the IMF team about the economic challenges being faced by the country and shared the GoP’s vision for bringing about macroeconomic stability. He also informed that all prior actions for the 9th Review under the Extended Fund Facility have already been completed and the government was fully committed to fulfilling its obligations as agreed with the IMF. He mentioned that the only IMF programme completed successfully was under his previous tenure as finance minister.

Jihad Azour, Director, IMF, expressed his confidence that Staff Level Agreement (SLA) will be signed soon followed by the IMF Board’s approval. He hoped that Pakistan would continue towards its progress on the reforms in various sectors and complete the IMF programme in time and IMF will play a positive role in bringing economic stability. The finance minister thanked Director Jihad Azour and his team for the support extended in completing the 9th Review.

Meanwhile, Pakistan has not yet received confirmation on additional $1 billion deposits from United Arab Emirates (UAE), and this remains the last stumbling block in the way of striking a staff-level agreement, it was learnt. One top official of the Finance Ministry on Wednesday night told this scribe that the government had made top-level contacts with the UAE authorities, and work was going on in this regard. But it is not yet known how much time the UAE will take to confirm to the IMF about the deposit amount.

This scribe contacted another top official who said that the UAE had not yet given confirmation and it was the only stumbling block in the way of the signing of SLA. When asked about cross-fuel subsidy, he said that it could not be implemented, so it would not be a major issue in the way of signing the staff-level agreements.

It is also not known how the IMF and Pak sides would resolve issues for accomplishing the 10th and 11th reviews under the $6.5 billion Extended Fund Facility. There is one option for extending the time-frame of the EFF programme to bridge the financing between the expiry and the possibility of getting a fresh IMF programme.