Pakistan 'seeks' additional $2b climate fund from IMF

ISLAMABAD: The government of Pakistan is seeking an additional $2 billion from the International Monetary Fund (IMF) to address the impacts of climate change, ARY News reported citing sources. 

According to sources, Finance Minister Muhammad Aurangzeb will make the request during the annual IMF meetings, scheduled to take place later this month.

This development came after Pakistan’s initial request for climate financing was not immediately approved by the IMF, sources said.

Sources revealed that Pakistan has taken steps to address fiscal sustainability and mobilize revenue, including passing the FY24 budget, which advances a primary surplus of around 0.4 percent of GDP. The government has also committed to ensuring a market-determined exchange rate and reducing inflation.

Furthermore, the Finance Minister will attend the IMF meetings alongside the Secretary of Finance and State Bank officials. The meetings are scheduled to conclude by October 26.

Read more: Pakistan receives first tranche of IMF loan

Earlier on September 27, Pakistan requested an additional $1.5 billion loan from IMF to combat the impacts of climate change in the country.

During a meeting with IMF Managing Director Kristalina Georgieva, Prime Minister Shehbaz Sharif discussed the need for urgent action to control climate change in Pakistan.

The loan will support Pakistan’s Climate Resilience and Sustainability Facility, which aims to promote economic stability and sustainable development in the country.

It is important to mention here that the International Monetary Fund (IMF) Executive Board on September 25 approved Pakistan’s 37-month Extended Fund Facility (EFF) arrangement of about US$7 billion.

The 37-month Extended Fund Facility arrangement aims to support Pakistan’s economic stability and growth, with key policy goals including sustainable public finances, reduced inflation, and strengthened external buffers.