Islamabad:
The US has agreed to help poor Pakistan negotiate a deal with the IMF to revive the country’s economic bailout program with the global lender, a media report reported.
Pakistan and the IMF have yet to reach a staff-level agreement to revive the Extended Fund Facility (EFF), putting Pakistani authorities in a tight position to bridge the gap and implement the updated federal budget for the fiscal year. 2022-23 passed by the National Assembly, Dawn newspaper reported.
The US has agreed to help Pakistan negotiate a deal with the International Monetary Fund (IMF), the newspaper reported, citing unnamed diplomatic sources.
Previously, media reports had claimed Islamabad was “seeking Washington’s support” for renewing its EFF at the IMF.
As the largest shareholder, the US has a major influence on the decision-making of the IMF.
On Saturday, Pakistani Ambassador to the United States Masood Khan met Assistant US Trade Representative (USTR) for South and Central Asia Christopher Wilson to discuss expanding trade relations between the two countries and encouraging US investment in Pakistan. discuss, a statement said.
The USTR office is responsible for developing and coordinating international trade and commodities in the US and directing investment policy. It also oversees trade talks with other countries, the paper reported.
Pakistan signed a 39-month EFF worth $6 billion in July 2019, but the IMF withdrew about $3 billion when the previous government failed to meet its obligations, the report said.
At this point, Islamabad wants the IMF to not only resume disbursements but also expand the scope and duration of the program, the report said.
A top finance ministry official confirmed on Sunday evening that they had not yet received the first draft of the IMF’s Memorandum of Economic and Financial Policy (MEFP) as intended, as certain issues were still unresolved.
“We are working very closely with the IMF and will come to a conclusion shortly,” the official said.
According to the Ministry of Finance, the government aims to have the 2022-23 budget approved by the National Assembly on June 27-28.
Pakistan has repeatedly requested international aid to support its failing economy.
In May, Saudi Arabia agreed to provide Pakistan with a “significant package” of about $8 billion to help the poor country bolster dwindling forex reserves and revive its ailing economy.
Pakistan secured the deal during Prime Minister Shehbaz Sharif’s visit to Saudi Arabia in April. The financial package includes doubling the oil financing facility, additional money through deposits or Sukuks, and rolling over the existing $4.2 billion facilities.
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