Last Updated on: 20th July 2023, 04:03 pm
Pakistan Seeks Help From US To Negotiate Deal With IMF
In line with Pakistan’s call for US assistance in reviving the International Monetary Fund (IMF) program, the latter has agreed to help Islamabad negotiate a deal with the global lender, News media reported, citing diplomatic sources.
Earlier, a senior Treasury official told The News that Treasury Secretary Miftah Ismail and Treasury Secretary Aisha Ghaus Pasha met with the US ambassador last week.
However, the source added that this would not be enough as Islamabad would have to “make contacts” with senior US Treasury officials to get the necessary support after reaching a consensus on the framework within which both sides could move forward with signing a Memorandum on Economic and Fiscal Policy (MEFP).
The MEEP is a prerequisite for signing the staff agreement as it provides the basis for a framework on which both parties can develop consensus.
“Without a broader agreement based on a framework, nobody could help Pakistan,” the official said.
Also Read: IMF Says Pakistan’s Debt Will Increase To Over 78% Of GDP
According to the publication’s report, Pakistan has asked the United States for assistance as the global lender has yet to agree to a staff-level pact, despite the government taking many tough steps and Washington having significant influence over the IMF’s decision-making as the major shareholder.
Another report in news media states that Pakistan has not yet received the first draft of the GFSM from the IMF, as previously expected, as some issues remain unresolved. “We are working closely with the IMF and will come to a conclusion soon,” a senior Treasury Department official told the publication.
Also Read: IMF Calls On The FBR To Increase Tax Burden On Salaried Class
Treasury authorities were expected to finalize the employee-level agreement by Sunday (June 19) on the basis of revenue and expenditure measures that will leave next year’s primary budget (the difference between revenue and expenditure, excluding interest payments) in a surplus of 152 billion rupees.
The govt took the toughest measures to end fuel subsidies and raised POL [gasoline, oil, and lubricants] prices to unprecedented levels to convince the fund to restart the scheme. However, the IMF insists on doing more, knowing Islamabad has become a “desperate borrower” largely due to depleted foreign exchange reserves.
The fund still has reservations about the Rs 9.5 trillion spendings planned by the authorities for the next financial year. Budgetary revenue measures are also not enough to meet the Rs 7 trillion target, according to IMF estimates.
Also Read: Pak Rupee Breaks All-Time Highs Against The US Dollar Amid Bumpy IMF Talks And Oil Slides