Loan After repeated requests, debt-ridden Pakistan has finally got a loan from the IMF. The Executive Board of the International Monetary Fund on Wednesday approved a new loan of $7 billion for cash-strapped Pakistan. More than two months ago, both sides said that they had reached an agreement. Officials said that Pakistan will get this loan in installments over 37 months. The purpose of this loan is to help bring Pakistan’s faltering economy back on track.
Pakistan said thank you to IMF
In a statement, Pakistani Prime Minister Shahbaz Sharif welcomed the agreement that his team had been negotiating with the IMF since June. He thanked IMF chief Kristalina Georgieva and her team for the approval. The global lender said it would release about $1 billion of the loan immediately.
IMF praised Pakistan
In a statement issued on Thursday, the IMF praised Pakistan for taking important steps to restore economic stability. Growth has accelerated. Inflation has fallen to single digits and a calm foreign exchange market has helped rebuild reserves. But it also criticised government officials. The IMF warned that despite the progress, Pakistan’s vulnerabilities and structural challenges remain formidable. It said a difficult business environment, weak governance and an outsized role of government have hindered investment, while the tax base remains too small.
also warned
“Spending on health and education has not been adequate, leading to rising poverty, and inadequate infrastructure investment has limited economic potential,” the IMF warned. The IMF reached a staff-level agreement with Pakistan for the new loan more than two months ago. Officials said the loan was approved after Pakistan met all the conditions set by the IMF. Pakistan has relied on IMF loans to meet its economic needs for decades. Sharif thanked China and other friendly countries for facilitating Pakistan’s deal with the IMF.
