Islamabad: Pakistan and the International Monetary Fund (IMF) have reached a staff-level agreement to release USD 1.17 billion, news sources reported on July 14. The funds will be released under the Extended Fund Facility (EFF) agreed upon between the parties in 2018.
According to reports, the IMF has agreed to provide funds to maintain the country’s current account and provide fiscal support. The funds will be released, however, only following the approval of the IMF executive board. In a Twitter post, Finance Minister Miftah Ismail explained the new deal between Pakistan and the IMF, saying that the IMF will also expand the loan program to USD 7 billion after adding 720 million in Special Drawing Rights (SDR).
Moreover, it is essential to mention that the IMF and Pakistan finance teams reached an agreement after presenting the USD 45 billion finance budget for FY 22-23. However, the IMF required additional spending cuts before releasing funding to the government. Pakistan and the IMF signed a credit arrangement in 2018, totalling USD 6 billion. The government is currently on the final leg of the financing arrangement, with the seventh and eighth trenches representing the end of the programme.