IMF approves $6 billion loan for Pakistan

ISLAMABAD, Jul 03 (APP):The International Monetary Fund (IMF) on Wednesday approved a loan of $6 billion for Pakistan, a 39-month extended arrangement, to support the country’s economic reform program.

After approval of the loan under Extended Fund Facility (EFF) by the Executive Board of IMF, Pakistan is now eligible to immediately receive first tranche of $1 billion, an IMF statement said.

The fund will quarterly review the performance of Pakistan over 39 months.

The EFF-supported program would help Pakistan to reduce economic vulnerabilities and generate sustainable and balanced growth.

The statement added that the programme would focus on a decisive fiscal consolidation to reduce public debt and build resilience while expanding social spending.

It will also try to ensure a flexible, market-determined exchange rate to restore competitiveness and rebuild official reserves besides eliminating quasi-fiscal losses in the energy sector, strengthening institutions and enhancing transparency.

Meanwhile, Advisor to Prime Minister on Finance Dr Abdul Hafeez Shaikh said the IMF’s support bodes well for the country and is a testament to the government’s resolve for ensuring financial discipline and sound economic management.

Welcoming the IMF approval of $6 billion loan for Pakistan, Hafeez Shaikh said in a tweet that structural reform agenda which includes improving public finances and reducing public debt through revenue reforms is key part of the program.

“Our program supports broad based growth by reducing imbalances in the economy. Social spending has been strengthened to completely protect vulnerable segments”, the advisor added.