Business

IMF Approves USD 700 Million Second Tranche Of USD 3 Billion Package For Pakistan

Ahead of the next month’s elections, the IMF on Thursday approved a USD 700 million loan tranche for cash-strapped Pakistan under an existing USD 3 billion bailout package after completing its first review of the country’s economic reform programme.

The Ministry of Finance announced the completion of the first review by the Executive Board of the Washington-based International Monetary Fund (IMF), the Dawn newspaper reported.

A mission from the Washington-based global lender reviewed the country’s economic performance during the first three months of the fiscal year – from July to September, 2023.

The completion of the review allows for an immediate disbursement of USD 700 million in Special Drawing Rights (SDR), bringing the total disbursements under the Stand-By Arrangement (SBA) to USD 1.9 billion, the ministry said in a statement.

The initial tranche of USD 1.2 billion of the current IMF programme amounting to USD 3 billion– was released in July 2023.

The other two tranches were subject to reviews, the first of which has been completed, while the other one will be in December, The News International newspaper reported.

In November 2023, an SBA was reached between the IMF staff and Pakistani authorities regarding the first review under Pakistan’s SBA.

The global lender signed a nine-month USD 3 billion financing arrangement with Pakistan in June 2023 to provide the debt-struck country with a short-term loan.

Pakistan’s economy has been in a free fall mode for the last many years, bringing untold pressure on the poor masses in the form of unchecked inflation, making it almost impossible for a vast number of people to make ends meet.

Pakistan had been struggling to arrange enough foreign exchange to satisfy the IMF, which refused to provide the remaining USD 2.5 billion out of a USD 6.5 billion loan programme signed in 2019 and expired on June 30 last year.

PTI

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Bharat Express English

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