IMF asks govt how sustainable its fiscal steps are

ISLAMABAD: The International Monetary Fund (IMF) delegation Thursday praised the measures taken by Pakistan so far but emphasised that Pakistan would have to strictly implement all the targets set under the loan programme.

The Fund team, led by Mission Chief Nathan Porter, kick-started the first round of talks at the finance ministry and raised questions over the sustainability of the fiscal framework for the whole financial year 2023-24. The delegation also underscored the importance of the continuation of efforts to stay on track for achieving economic stability in the country. It sought details of tax revenue prospects, materialisation of planned budgetary target of Rs9.4 trillion and additional tax revenue measures, if needed, during the course of parleys. Both delegations would continue technical-level talks from November 2 to 10, 2023. Then the policy-level talks will begin from November 13 to 16, 2023.

“In the first round of technical level talks, Pakistan’s Minister for Finance Shamshad Akhtar shared the overall picture of the economy and commitment for the continuation of reform agenda under the Fund programme,” said official sources and added that the IMF side patiently listened to the Pakistani side and just sought explanations where it required.

“The crucial policy level talks will be held next week when the IMF will come up with its prescription for finalising the memorandum of economic and financial policies under the first review of the $3 billion Standby Arrangement programme,” said the official.

If Pakistan and the IMF were able to strike a staff-level agreement, then Islamabad would be able to get a $700 million tranche under the SBA programme.

According to an official statement issued by the Ministry of Finance, the caretaker Federal Minister for Finance, Revenue, & Economic Affairs Dr Shamshad Akhtar held a meeting with the IMF Review Mission, led by Mission Chief Nathan Porter at the Finance Division. It was attended by IMF resident representative, Ms. Esther Perez Ruiz, SBP Governor Jamil Ahmed, FBR chairman, SECP chairman, finance secretary, members of the IMF delegation and senior officers from the Finance Division.

Dr Shamshad welcomed the delegation and shared progress on the SBA. She briefed the Mission on fiscal measures being taken by the government to improve the economic situation.

The meeting also included a discussion on comprehensive reforms and measures undertaken by the FBR and the government’s strategies to address the circular debt issue.

Nathan Porter appreciated the government’s commitment to meeting the 1st Quarter targets and commended the government’s efforts and measures taken in some critical areas. He underscored the importance of the continuation of these efforts to stay on track for the economic stability of the country. Dr Shamshad expressed her appreciation for the continued support and assistance of the IMF.

She reaffirmed the government’s commitment to working closely with the IMF to ensure the successful completion of the SBA and achieve the economic objectives.

Meanwhile, Dr. Tauqeer Hussain Shah, the executive director-designate World Bank, called on Dr Shamshad Akhtar at the Ministry of Finance.

Ministers for Privatisation & Energy, SECP chairman, FBR chairman, secretaries of Finance & Economic Affairs & Country Director World Bank were also present.

The finance minister appreciated the contributions of Dr Tauqeer Shah to public service and hoped that he would utilise his experience in fostering strong collaboration between Pakistan and the World Bank.

Dr Shah thanked the finance minister for her guidance and immense support and promised to focus his energies on enhancing Pakistan’s cooperation with the World Bank.