ISLAMABAD: Pakistan is on the verge of securing a Staff-Level Agreement (SLA) with the International Monetary Fund (IMF), as negotiations enter their final phase without major obstacles, Finance Minister Muhammad Aurangzeb announced on Friday.
IMF Talks in Final Stages
- Speaking to journalists, Aurangzeb reassured that Pakistan is on track to meet the IMF’s economic discipline targets and that discussions are progressing smoothly.
- The first review of the $7 billion Extended Fund Facility (EFF) has seen significant progress, bringing Pakistan closer to unlocking the next $1 billion tranche of funding.
- IMF Mission Chief Nathan Porter, after concluding his visit, confirmed that both sides had made substantial progress toward reaching an agreement.
- The IMF team was in Pakistan from February 24 to March 14, discussing not only the EFF review but also the potential for a new arrangement under the Resilience and Sustainability Facility (RSF).
Economic Reforms & Fiscal Responsibility
- Aurangzeb stressed that the government is committed to economic reforms and fiscal responsibility, ensuring long-term stability.
- The IMF-backed programme has played a key role in stabilizing Pakistan’s economy, with authorities optimistic about a long-term recovery plan.
Structured Climate Financing & Disaster Resilience
- Speaking at an event on climate change, the finance minister addressed Pakistan’s vulnerability to environmental shifts and climate-related economic disruptions.
- Key Climate Challenges Highlighted:
- Rapid glacier melt and its impact on water cycles.
- Severe pollution in Lahore and worsening air quality.
- Insufficient winter rainfall, signaling an environmental crisis.
- $10 Billion in International Donor Pledges: Pakistan has received pledges for flood rehabilitation projects, but implementation challenges have slowed fund utilization.
- Aurangzeb called for a structured climate financing system and urged faster project timelines to mitigate environmental risks.
Collaboration with Global Institutions
- Pakistan is deepening its partnership with the World Bank to finance climate resilience projects.
- The Everest K2 Research Centre is conducting studies on glacial melt patterns and their impact on water resources.
Outlook & Next Steps
- The government remains optimistic about securing the IMF’s approval for the first review, unlocking critical funding to support economic stability.
- Climate financing and sustainability measures will also remain a key focus, ensuring long-term resilience against environmental and economic shocks.
