Business

Pakistan again seeks US help to unlock stalled IMF programme

Published

2 years ago

Farwa

US Ambassador Donald Blome calls on Ishaq Dar.
“Dar asks envoy to help in unlocking critial IMF loan”.
Hopes are diminishing for revival of IMF programme.

ISLAMABAD: Minister for Finance and Revenue Senator Ishaq Dar has again sought the United States’ help to unlock the stalled $1.1 billion International Monetary Fund loan, sources told Geo News Wednesday.

The US is a significant player in the IMF, and Pakistan seeks to use its position as a long-time ally for concluding the Extended Fund Facility’s ninth review.

The development came during Dar’s meeting with US Ambassador to Pakistan Donald Blome.

“[Both sides] discussed matters of mutual interest between the two countries,” a statement from the Ministry of Finance read.

Despite several attempts from the Pakistani side, hopes are diminishing for the revival of the IMF programme, which will expire on June 30.

The IMF sent out its review mission on January 31 to February 9, 2023, but the Staff Level Agreement (SLA) could not be signed.

The lender placed strict conditions before signing the SLA, which Pakistan said had already been met.

Minister for Finance Dar held virtual meetings with the IMF high-ups in April to strike a consensus but failed to break the ice between the two sides.

Then the prime minister made a telephone call to IMF MD and discussed issues for the revival of the stalled programme. However, nothing substantial was achieved.

Later, IMF Resident Chief Esther Perez Ruiz issued a statement criticising the budget 2023-24.

The Ministry of Finance also issued a statement in its response, but both sides showed commitment to remain engaged for the conclusion of the pending ninth review.

Pakistan has also asked the Washington-based lender to arrange a meeting of Prime Minister Shehbaz Sharif with IMF Managing Director Kristalina Georgieva on the sidelines of the upcoming New Global Financing Pact Summit being held in Paris from June 22-23.

“If this request is turned down, then there will be no possibility of reviving the Fund programme under the $6.7 billion Extended Fund Facility. However, if the meeting is held and both sides achieve a breakthrough, then chances of reviving the programme will brighten,” a top official said while talking to The News on Tuesday.

Foreign exchange reserves held by the State Bank of Pakistan (SBP) stand at around $4 billion, enough to cover less than a month’s imports.

Business

E&P Companies Will Invest $5 Billion in Pakistan’s Petroleum Industry

Published

2 days ago

Farwa

Over the next three years, local and foreign companies involved in Pakistan’s oil and gas exploration and production sector have shown a strong desire to invest more than $5 billion in the nation’s energy sector.

Recent changes to the Petroleum Policy and the implementation of an exclusive tight gas policy, which provide better incentives and a more investor-friendly regulatory framework, are credited with the increase in investor confidence.

These strategic changes are expected to boost domestic energy production, open up new avenues for growth, and draw large amounts of both domestic and foreign investment.

Business

With inflation slowing, the SBP is anticipated to lower the policy rate for the eighth time in a row.

Published

2 days ago

Farwa

Businesspeople anticipate another reduction in the policy rate when the State Bank of Pakistan’s (SBP) Monetary Policy Committee (MPC) releases the updated rate.

The interest rate for the upcoming two months will be announced by the central bank. It is still unclear if the rate will stay the same or be lowered to reflect stakeholder expectations.

According to experts, the policy rate will be lowered in order to further boost the nation’s economic sector.

Interest rates may be lowered for the seventh time in a row if the inflation rate declines significantly more than anticipated.

In its last six sessions, the MPC had cut the policy rate by 10 percent. In January 2025, it decreased the rate by one percent to 12pc.

12PC POLICY RATE

In January, the State Bank of Pakistan (SBP) announced cut in key policy rate by 100 basis points (bps) to 12 percent from 13pc in line with expectations of the business community.

The policy rate, which had been at 22 percent since June 2024, was slashed by 1,000 basis points to 12 percent.

The SBP governor said the decision was taken with careful consideration. “Although inflation is expected to decline next month (February), core inflation remains a pressing concern,” he stated.

Ahmed highlighted strong remittance inflows and robust export growth as key factors supporting the current account.