ISLAMABAD: The Pakistani government confirmed on Monday that an International Monetary Fund team was in Islamabad and holding discussions with finance ministry officials, as Islamabad kicks off talks with the fund over a longer-term bailout program.
Pakistan last month completed a short-term $3 billion program, which helped stave off sovereign default, but the government of Prime Minister Shehbaz Sharif has stressed the need for a fresh, longer term program.
Finance minister Muhammad Aurangzeb said last week the IMF mission would visit Islamabad in May and Pakistan hoped to have a deal by early July.
“The IMF team has arrived in Islamabad and currently talks are underway with them in the finance ministry,” Raeesa Adil, Director General Media at the Finance Ministry told Arab News, declining to share further details of what was being discussed.
Pakistan narrowly averted default last summer, and its $350 billion economy has stabilized after the completion of the last IMF program, with inflation coming down to around 17 percent in April from a record high 38 percent last May.
It is still dealing with a high fiscal shortfall and while it has controlled its external account deficit through import control mechanisms, it has come at the expense of stagnating growth, which is expected to be around 2 percent this year compared to negative growth last year.
Pakistan is expected to seek at least $6 billion and request additional financing from the Fund under the Resilience and Sustainability Trust.