The International Monetary Fund (IMF) is set to meet with Pakistani authorities next week to discuss plans for “better governance” and “stronger economic growth” in the cash-strapped country. After completing a short-term $3 billion program with the IMF last month, Pakistan is now seeking a longer and larger bailout package to stabilize its economy.
An advance team from the IMF has already arrived in Pakistan to kickstart discussions following Islamabad’s request for additional financial assistance. The mission team, led by IMF’s mission chief to Pakistan, Nathan Porter, aims to lay the groundwork for improved governance and more inclusive economic growth that will benefit all Pakistanis.
Pakistan is seeking a bailout package ranging from $6 to $8 billion over three years under the Extended Fund Facility (EFF), with the possibility of additional funding through climate financing. To bridge the external financing gap, the country plans to seek a rollover of around $12 billion in debt from key allies like China in the upcoming fiscal year.
Despite narrowly avoiding default last summer, Pakistan still faces challenges such as a high fiscal shortfall and stagnant growth. While inflation has decreased to around 17 percent from a record high of 38 percent last year, the economy is expected to grow by only 2 percent this year, compared to negative growth in the previous year.
The upcoming discussions with the IMF will be crucial for Pakistan’s economic recovery and stability as the country continues to navigate its financial challenges.