Pakistan Not on IMF's August 28 Agenda; External Financing Issues Persist
As of now, Pakistan is not listed on the International Monetary Fund’s (IMF) agenda for August 28, 2024. The country has yet to address a critical external financing gap of $3 to $5 billion, which continues to hinder the approval of a new bailout package under the Extended Fund Facility (EFF).
Despite reaching a staff-level agreement with the IMF five weeks ago, Pakistan has been unable to formalize its request for a $7 billion EFF package. This delay is largely due to the absence of a signed Letter of Intent (LoI) from Pakistan’s finance minister and the State Bank of Pakistan governor. The LoI is essential for formally requesting the IMF executive board’s approval.
External financing remains a major obstacle, with the IMF’s schedule indicating that Pakistan is not among the countries being considered for loan approval until the end of August. Federal Minister for Finance Mohammad Aurangzeb, when asked about the status of the LoI and board approval, mentioned that “good progress” is being made, with expectations set for approval in September.
The staff-level agreement, finalized on July 12, 2024, was contingent on both board approval and the timely confirmation of necessary financing assurances from Pakistan’s development and bilateral partners.
