FinMin ‘hopeful’ Pakistan’s case to be considered by IMF board in September

Islamabad:

Finance Minister Muhammad Aurangzeb hopes that Pakistan’s case will be presented at the International Monetary Fund (IMF) board meeting in September.

During a meeting of the Senate Standing Committee on Finance on Wednesday, chaired by Saleem Mandviwalla, the finance czar clarified recent media reports on the IMF programme.

The decision of the International Monetary Fund (IMF) to postpone the approval of the $7 billion bailout package has called into question Pakistan’s tilt towards the West and also jeopardized the credibility of its policies.

The IMF board meeting was conditional on providing credible assurances to meet its $26.4 billion external debt repayment requirements for this fiscal year, which the government was unable to secure by the deadline, according to government officials .

In today’s meeting, Minister Aurangzeb said that negotiations with the IMF are progressing positively and it is expected that Pakistan’s case will be presented at the September board meeting.

The minister also mentioned that the IMF has set some conditions, including the approval of the amending bill for the protection of deposits before October.

The bill will be tabled in Parliament next week, following a committee recommendation.

The government had hoped to get the stamp of approval from the IMF’s Executive Board on August 30 for the $7 billion Expanded Fund Facility (EFF).

Islamabad had reached a staff-level agreement last month on the condition that it fill the funding gap with the help of bilateral and multilateral creditors.

“We were told a few days ago that the IMF board will not take up the Pakistan case on August 30 as the external financing gap could not be bridged,” a senior finance ministry official said on Tuesday.

He said the reason behind the postponement of the meeting was the unfilled $2 billion funding gap and the delay in converting much of the $12 billion in cash deposits.

Chinese commercial bank loans of $3.9 billion were also not deferred. So far, the United Arab Emirates (UAE) alone has deposited over $1 billion in cash.