IMF Executive Board excludes Pakistan from December agenda amid financial uncertainty
Pakistan’s economic prospects have been hit with uncertainty as the International Monetary Fund (IMF) Executive Board has not scheduled a review of the country’s $6 billion Extended Fund Facility (EFF) through December 14. This decision comes despite earlier expectations of a critical meeting that could determine the release of a $700 million tranche to Pakistan.
Finance ministry officials had been hopeful about a December 7 ratification of Pakistan’s Staff Level Agreement (SLA), which would facilitate the disbursement under their standby arrangement. The anticipation was also tied to discussions on new loans and potential energy price increases. However, the IMF’s latest agenda omission suggests that these expectations might not materialize as planned.
Adding to the financial strain, policy debates within Pakistan are considering delaying the IMF’s second review talks until after the country’s February elections due to scheduling conflicts. This delay could have significant implications for Pakistan’s economy, as the nation relies on foreign loan inflows to meet its financial obligations. The absence of a fixed date for the review following the November SLA, coupled with the SBA program set to conclude on April 14, places additional pressure on Pakistan’s financial strategies for December.
Moreover, delays in scheduling an IMF Executive Board meeting for reviewing Pakistan’s SBA program are linked to ongoing creditor re-confirmations for a $24.9 billion financing need. The uncertainty surrounding these talks and the pending decision on the $700 million tranche release are casting shadows over Pakistan’s economic outlook as it navigates through its financial challenges.
