IMF says Pakistan's economy improving after standby agreement

International Monetary Fund (IMF) on Friday said that Pakistan’s economy is improving after a $3 billion stand-by arrangement, ARY News reported.

Addressing a press conference on Regional Economic Outlook, Jihad Azour, Director of the Middle East and Central Asia Department of International Monetary Fund (IMF) said that the current program that was initiated ten months ago allowed Pakistan to achieve a certain number of important milestones in terms of economic stability.

He said that the last review was successful and will be put forward to the board, which will end a program that helped Pakistan address acute economic imbalances and maintain its economic stabilities.

Currently, the authorities have expressed interest in a new program in order to help Pakistan address some of the key challenges, Azour added.

Jihad Azour stated that one challenge is to preserve macroeconomic stability and this would require to continue the work on fiscal side in order to reduce the level of budget deficits, strengthen the fiscal situation by improving the revenue situation, which was one of the main challenges in the past. Increasing revenues will allow the government not only to address debt situation but also to have the room to provide additional social support.

The second pillar is the reform of the energy sector and this is a priority, he said in the press conference.

Azour pointed out the third important pillar saying that Pakistan is a large economy with a large potential. Leveling the playing field, improving business environment, allowing the private sector to be having more space internally and also on the export side will help Pakistan.

It is important to mention here that Pakistan and the IMF last month reached a staff-level agreement on the second and last review of the $3 billion stand-by arrangement, which, if cleared by the global lender’s board, will release about $1.1 billion to the country.

The IMF’s board is expected to review the matter in late April, but no firm date has been set, a spokesperson said.