ISLAMABAD:Finance Minister Muhammad Aurangzeb said that the government was at the “advanced stages” of getting assurances about external financing but he again did not give a firm timeframe to conclude the pending $7 billion deal with the International Monetary Fund (IMF).
The statement came the day the IMF released its executive board meeting calendar till September 13 without putting Pakistan on the agenda.
The reason for keeping Islamabad out of the schedule is the country’s inability to secure the rollover of the $12 billion old debt and another $2 billion in fresh loans.
“On the discussions with the IMF, we are in advanced stages in terms of getting assurances around our external financing,” Aurangzeb said in his televised speech at the state-run news channel.
The finance minister further said that he was hopeful that the IMF Executive Board will approve the $7 billion programme “on time”. But he, for the first time, did not mention the month of September, contrary to his last statement on the issue in which he had said that the IMF board would approve the case in September.
Pakistan and the IMF had signed the staff-level agreement for a 37-month Extended Fund Facility (EFF) worth $7 billion on July 12th. The country was hopeful to receive the final endorsement of the executive board before the end of August.
However, it could not materialize due to the country’s inability to secure $12 billion in rollovers from Saudi Arabia, China and the United Arab Emirates.Pakistan has also sought an additional $1.2 billion loan from Saudi Arabia to address a $2 billion financing gap.
The finance minister’s statement affirmed that these deals were still pending, though he was constantly in touch with his counterparts in these countries.
The government’s problems augmented after the Punjab government gave Rs45 billion to Rs90 billion two-month subsidy on electricity. The IMF has now permanently banned any subsidy on gas and electricity by the provincial governments during the duration of its programme.
Aurangzeb lauded the role of the four provincial chief ministers for helping in reaching the staff-level agreement with the IMF. He reiterated the prime minister’s earlier statement that this is going to be Pakistan’s last programme with the IMF. “For this, we need to deliver on structural reforms,” he said.
