New IMF programme to bring macroeconomic stability: Finance Minister

ISLAMABAD: Finance Minister Muhammad Aurangzeb on Saturday said the new $7 billion aid package deal reached between Pakistan and the International Monetary Fund (IMF) would help bring macroeconomic stability to the country.

The international lender announced the development late last night, giving much-needed respite to the nation.

The programme, which needs to be approved by the IMF’s Executive Board, should enable Pakistan to “cement macroeconomic stability and create conditions for stronger, more inclusive and resilient growth,” it said in a statement.

Coming to Pakistan in the form of loans, the latest bailout follows a commitment by the government to implement reforms, including a major effort to broad­­en the country’s tax base.

IMF and Pakistan seal $7 billion deal

Commenting on the deal today, Aurangzeb said it would aid Pakistan in achieving macroeconomic stability.

Under the programme “we need to ensure structural reforms and bring self-sustainability in areas of public finance, energy, and state-owned institutions”, Geo News quoted him as saying.

Faced with chronic mismanagement, Pakistan’s economy has found itself on the brink, challenged by the Covid-19 pandemic, the effects of the war in Ukraine and supply difficulties that fuelled inflation, as well as record flooding that affected a third of the country in 2022.

With its foreign currency reserves dwindling, Pakistan found itself in a debt crisis and was forced to turn to the IMF, obtaining its first emergency loan in the summer of 2023.