The International Monetary Fund (IMF) and Pakistan have entered into an agreement at the level of personnel on the first examination of the facility of the extended fund of Pakistan (EFF) and a new arrangement under the installation of resilience and sustainability (RSF), according to an official IMF press release released Today.
The staff level agreement, which is subject to the approval of the IMF executive council, includes access to around 1.3 billion dollars under the RSF for climate resilience and sustainability efforts in the next 28 months.
In addition, the agreement provides Pakistan for about 1.0 billion dollars under the efficient, which brings about $ 2.0 billion in total disbursements under the program.
This agreement comes after numerous discussions between IMF staff, led by Nathan Porter, and the Pakistani authorities, including meetings held in Karachi and Islamabad between February 24 and March 14, 2025.
According to the IMF, Pakistan has made significant progress in restoring macroeconomic stability despite a difficult global environment.
The key objective of the program supported by Effe is on budgetary consolidation, monetary policy to control inflation and reforms to improve the energy sector of Pakistan.
The Pakistani government aims to reduce public debt, improve the viability of the energy sector and improve social protection, in particular for health and education.
The RSF, designed to treat long -standing vulnerabilities to climatic shocks, will support Pakistan’s efforts to strengthen resilience to natural disasters and improve climate adaptation. The specific objectives include improving public investment planning, improving the efficiency of water consumption and promoting green energy and mobility.
In accordance with the agreement, the Pakistani authorities reiterated their commitment to pursue structural reforms in key areas.
The government focuses on the continuation of budgetary reforms to reduce public debt and ensure transparency. Efforts to strengthen tax systems and improve public management of the public are also at the heart of the reform program.
The IMF has stressed the importance of maintaining close monetary policies to control inflation, which has fallen at its lowest level since 2015, and to build exchange reserves to stabilize the economy.
In addition, Pakistan plans to continue energy sector reforms to reduce costs and improve distribution efficiency.
Despite the progress made, the IMF warns that the risks remain high, in particular concerning the global economic conditions and the challenges linked to the climate. Pakistan must keep the course with its reform efforts to ensure long -term growth and stability.
The IMF also recognized Pakistan’s commitment to achieve climate adaptation objectives and stressed the importance of continuous support for disaster resilience initiatives.
“In the past 18 months, Pakistan has made significant progress in restoring macroeconomic stability and the reconstruction of confidence despite a difficult global environment. Although economic growth remains moderate, inflation has decreased at its lowest level since 2015, financial conditions have improved. Slides – directed by pressures to facilitate policies – as well as geopolitical shocks at the prices of raw matters, Tightening global financial conditions or the rise in protectionism could undermine hard -won macroeconomic stability.
“In this regard, it is essential to keep the course and strengthen the progress made in recent years and a half, to strengthen resilience by further strengthening public finances, guaranteeing prices stability, rebuilding external buffers and eliminating distortions in favor of stronger, inclusive and sustained growth in the private sector.”
The IMF team also thanked the Pakistani authorities, the private sector and the development partners for their hospitality and their productive discussions during the mission in Islamabad and Karachi.