Pakistan receives $454mln second tranche from IMF

ISLAMABAD (Web Desk) – Pakistan on Thursday received a $454 million second tranche from the International Monetary Fund (IMF) under a $6 billion Extended Fund Facility (EFF). The $454-million payment would be added to the country's foreign exchange reserves, currently at $17.6 billion, by next week. The IMF approved the EFF installment last Friday, saying that the country’s programme was on track and had started to bear fruit. However, it had warned that the risks remained. The approval came from the IMF’s executive board, which had made its decision after completing the first review of Pakistan’s economic performance. Earlier, the IMF executive board completed the first assessment of Pakistan’s economic performance and approved $452 million for Pakistan. According to the press release, the IMF executive board has completed the first review of Pakistan’s economic performance. In a statement first deputy managing director and acting chair said that $452 million would be given to Pakistan. The IMF has said Pakistan’s economic reforms program is on track and has started to bear fruit. The IMF executive board made this observation following completion of its first review of Pakistan’s economic performance under the Extended Fund Facility. The world lender said that decisive policy implementation by Pakistani authorities is helping to preserve economic stability. It also noted that transition to a market determined exchange rate has been orderly and inflation has started to stabilize, mitigating the impact on the most vulnerable groups of the population. The IMF was also appreciative of Pakistan’s commitment to expanding social safety nets, reducing poverty and narrowing the gender gap. In a statement, First Deputy Managing Director of the IMF David Lipton acknowledged Pakistan’s comprehensive plan to address the accumulation of arrears in the power sector. David Lipton also noted that efforts are ongoing in Pakistan to further improve the business environment, strengthen governance and foster private sector investment. He said reforms of the state owned enterprises will help put Pakistan’s public finances on a sustainable path and have positive spillovers by leveling the playing field and improving the provision of services. The completion of the review will allow Pakistan to draw about 452.5 million dollars from the world lender bringing the total disbursements to 1440 million dollars.