The technical teams of the Government of Pakistan has struck a deal with the International Monetary Fund (IMF) on a bailout package for about $6 billion over the next three years to meet foreign debt obligations, PM’s Adviser on Finance Dr Abdul Hafeez Shaikh announced on Sunday.
“After months of discussions and negotiations, a staff-level agreement has been reached between Pakistan and the IMF,” he said while speaking on state-run PTV News.
Shaikh revealed that Pakistan would receive $6 billion worth of assistance under the IMF programme over a period of three years. He also added that foreign loans have exceeded $90 billion, and exports have registered a negative growth over the past five years.
“The trade deficit reaches $20 billion and our foreign exchange reserves dipped by 50 per cent in past two years. So we have a $12 billion gap in our annual payments and we don’t have capacity to pay them,” the senior official said.
A government report out Friday said that the country’s growth rate is set to hit an eight-year low. The report by National Accounts Committee forecast growth of a mere 3.3 per cent in the current fiscal year against a projected target of 6.2 per cent.
An IMF press release quoted IMF Mission Chief for Pakistan Ernesto Ramirez Rigo as saying, “The Pakistani authorities and the IMF team have reached a staff level agreement on economic policies that could be supported by a 39-month Extended Fund Arrangement (EFF) for about US $6 billion.”