The Executive Board of the International Monetary Fund (IMF) will meet on May 9 to discuss Pakistan’s staff-level agreement for a new $1.3 billion arrangement under a climate resilience loan programme, along with the first review of Pakistan’s ongoing $7 billion bailout programme.
According to the IMF website, this is going to be the first “review under the Extended Arrangement Under the Extended Fund Facility”, along with request for an arrangement under the Resilience and Sustainability Facility (RSF).
Previously, Finance Minister Senator Muhammad Aurangzeb during his visit to Washington had said he also expected the IMF Executive Board to give its nod in early May.
Approval from the board would trigger the disbursement of a $1 billion tranche under the programme, which Pakistan secured in 2024. The IMF programme has played a critical role in stabilising Pakistan’s fragile economy, providing much-needed external financing and boosting market confidence.
Pakistan and the IMF had struck a three-year, $7 billion aid package deal in July 2024, with the new programme set to allow the country to “cement macroeconomic stability and create conditions for stronger, more inclusive and resilient growth”.
The ongoing 37-month EFF programme consists of six reviews over the life of the bailout, and the release of the next tranche of approximately $1 billion will be contingent on the success of the performance review.
In March, Pakistan and the IMF had conducted the first biannual review of the $7 billion loan programme on a positive note, without imposing additional revenue measures.
In an end-of-mission statement, mission chief Nathan Porter said: “Programme implementation has been strong, and the discussions have made considerable progress in several areas, including the planned fiscal consolidation to durably reduce public debt, maintenance of sufficiently tight monetary policy to maintain low inflation, acceleration of cost-reducing reforms to improve energy sector viability.”
A separate technical mission from the IMF also visited the country on Pakistan’s request for over $1 billion in additional financing for climate resilience.