IMF mission begins third EFF review talks with Pakistan

ISLAMABAD: An International Monetary Fund (IMF) mission, led by Iva Petrova, on Monday began talks with Federal Minister for Finance and Revenue Muhammad Aurangzeb for the third review of the $7 billion Extended Fund Facility (EFF) and the second review of the $1.1 billion Resilience and Sustainability Facility (RSF).

The IMF mission held its inaugural meeting with the finance minister as part of the review process.

During the discussions, the IMF will assess Pakistan’s fiscal performance for the first half of the current financial year.

The agenda also includes a review of the budget outlook for the ongoing fiscal year and an assessment of the economic impact of recent floods.

The government is expected to share its expenditure prioritisation plan with the IMF.

Officials will also explain the reasons behind the shortfall in tax collection targets and brief the delegation on the performance of sales tax and income tax collection.

The IMF team will be given a detailed briefing on Pakistan’s external debt and financing situation, including upcoming repayments and funding arrangements.

Earlier, the IMF sought assurances that a $2 billion deposit from the United Arab Emirates (UAE) would be rolled over for at least one year.

The IMF delegation reportedly raised concerns over the absence of confirmation regarding the one-year rollover of the UAE deposit.

Officials from the State Bank of Pakistan assured the visiting team during the economic review that significant progress on the rollover would be made.

Sources within the Ministry of Finance indicated that a meeting between the IMF delegation and the UAE ambassador is likely in order to secure progress on the matter.

State Bank of Pakistan officials also briefed the delegation that implementation of the external financing plan agreed with the International Monetary Fund is underway. They added that in the event of only a temporary rollover, the government remains engaged in further negotiations.