IMF Extends Pakistan's $3 Billion Bailout Program Review by One Day
By
March 19, 2024
An IMF team arrived in Pakistan last week for the second and final review of the country’s $3 billion bailout program, aiming to stabilize its fragile $350 billion economy. Pakistan aims to avoid a macroeconomic crisis and meet structural benchmarks set by the lender to unlock around $1.1 billion remaining tranche.
However, Pakistani officials stated that the review couldn’t be completed within the scheduled timeframe, prompting an extension by a day. The agenda includes discussions on taxation targets, subsidy removal, digitization of the tax system, and expanding the tax net.
Pakistan has been lagging in digitizing taxation and bringing over 3 million retailers into the tax net. Efforts are underway to address these issues, including the signing of a memorandum for tax system digitization.
The IMF emphasizes the need for Pakistan to continue economic stabilization and reforms, as talks for a new loan program progress positively. Since securing the IMF program last June, Pakistan has been striving to address challenges such as low reserves, a balance of payment crisis, high inflation, and currency depreciation.
