IMF likely to approve $7 billion loan program for Pakistan in Sept 25 meeting

The International Monetary Fund's (IMF) Executive Board will meet on September 25, during which it will likely approve a $7 billion loan program for Pakistan, IMF Media Director Julia Kozek said on Thursday.

Pakistan had reached a staff-level agreement with the IMF for a $7 billion Extended Fund Facility (EFF) in August. While the government had earlier stated that it expected the international lender's Executive Board to approve the program in the same month, delays occurred due to uncertainty about how the government would bridge a financing gap.

Pakistan has already received approval from Saudi Arabia and China to rollover loans amounting to $12 billion for the program's duration.

Kozek said today that the new EFF "aims to support Pakistani authorities' efforts to cement macroeconomic stability and create conditions for a stronger, more inclusive and resilient growth".

According to the IMF statement released on July 12th after the signing of Staff Level Agreement (SLA), Pakistan is expected to take certain steps as part of the program, which include strengthening fiscal and monetary policy and reforms to broaden the tax base, improving State Owned Enterprises' (SOE) management, strengthening competition, securing a level playing field for investment, enhancing human capital and scaling up social protection through increased generosity and coverage in the Benazir Income Support Program (BISP).