Pakistan Made Significant Progress to Staff Level Agreement: IMF

The International Monetary Fund (IMF) has announced substantial headway in discussions with Pakistani authorities regarding the first review of the country’s economic program under the Extended Fund Facility (EFF), following intensive negotiations in Islamabad and Karachi. The IMF delegation, led by Mission Chief Nathan Porter, conducted meetings from February 24 to March 14, 2025, focusing on both the ongoing EFF program and a potential new arrangement under the IMF’s Resilience and Sustainability Facility (RSF). “The IMF and the Pakistani authorities made significant progress toward reaching a Staff Level Agreement on the first review under the 37-month Extended Arrangement,” Porter stated in the mission’s concluding remarks. According to the IMF, Pakistan has demonstrated strong program implementation across several critical areas. The discussions advanced considerably on planned fiscal consolidation measures aimed at sustainably reducing public debt, maintaining appropriately tight monetary policy to control inflation, and accelerating cost-reducing reforms to improve the viability of the energy sector. The mission also noted progress in implementing Pakistan’s structural reform agenda, which aims to accelerate economic growth while strengthening social protection and rebuilding spending in health and education sectors. Additionally, the IMF team reported advancement in discussions regarding Pakistan’s climate reform agenda, which focuses on reducing vulnerabilities from natural disaster risks. These climate-related reforms could potentially be supported under a new arrangement through the IMF’s Resilience and Sustainability Facility. While significant progress was made during the in-person meetings, Porter stated that policy discussions would continue virtually “to finalize these discussions over the coming days,” suggesting that some technical details remain to be resolved before a final agreement can be announced. The successful completion of this review is crucial for Pakistan to secure the next tranche of funding under the $7 billion EFF program approved last year, which remains essential for the country’s economic stability and external financing needs. The IMF delegation expressed gratitude to Pakistani authorities, private sector representatives, and development partners for productive discussions throughout the mission.