IMF Director of Communications Julie Kozack
The International Monetary Fund (IMF) on Thursday said it “stands ready” to dispatch its mission to Pakistan for the final review of the ongoing $3 billion Stand-By Arrangement (SBA) after the formation of the new federal cabinet.
“The focus, therefore, is currently on completion of the current Stand-By program, which ends in April 2024. We look forward to working with the new government on policies to ensure macroeconomic stability,” IMF Director of Communications Julie Kozack told journalists at a press briefing.
She recalled the IMF Executive Board had approved the first review of the SBA—aimed at stabilizing the economy—on Jan. 11, with disbursements thus far totaling approximately $1.9 million.
Highlighting the caretaker government’s efforts, Kozack praised their commitment to fiscal targets, the protection of social safety nets, and a tight monetary policy to control inflation. She also acknowledged timely adjustments to tariffs to enhance the energy sector’s viability.
To a question on political instability in Pakistan, the official refrained from commenting on politics, stressing the global lender’s sole mandate was fiscal responsibility. She reiterated the IMF’s commitment to collaborating with the new government and expressed optimism about fostering stability for the benefit of the people of Pakistan.
Kozack’s statement follows Prime Minister Shehbaz Sharif, earlier this week, directing officials concerned to immediately commence work on negotiations with the IMF to complete the ongoing SBA and ink a new extended facility to shore up the country’s dwindling foreign exchange reserves. Last week, the Pakistan Tehreek-e-Insaf (PTI) wrote a letter to the IMF, asking it to defer any further bailout until the government had committed to a transparent audit of the Feb. 8 general elections.
Penned by spokesperson Raoof Hasan, the letter had alleged “widespread intervention and fraud in the counting of votes and compilation of results,” adding the global lender should “give effect” to its guidelines on good governance before agreeing to any new finance facility that would burden the people of Pakistan with further debt.
Separately, a spokesperson for the IMF—confirming the receipt of the PTI’s letter—stressed it has a “narrow mandate on economic issues.” According to Geo News, the spokesperson said the IMF encourages the “fair and peaceful resolution of all electoral disputes” in light of the importance of the institutional environment for economic stability and growth.
The spokesperson told the broadcaster that its engagement with Pakistan is focused on helping the government implement strong policies to deepen financial stability, address the longstanding economic and underlying balance of payments challenges, and restore sustained and inclusive growth for the benefit of all Pakistani citizens. “This includes stronger public finances, through high-quality revenue measures to broaden the tax base while scaling up the support for the most vulnerable, restoring energy sector viability, improving institutional governance and anti-corruption effectiveness, SOE reform, building climate resilience, and creating a level playing field for private businesses to promote investment and job creation,” they added.