The International Monetary Fund (IMF) has given its nod to the release of a crucial $700 million loan tranche for Pakistan, marking a big achievement in the country’s Stand-By Arrangement (SBA). The decision was announced by the Ministry of Finance through a post on X, highlighting the immediate disbursement that comes as a timely financial boost for Pakistan.
The Executive Board of the International Monetary Fund (IMF) completed the 1st review and allows for an immediate disbursement of SDR 528 million (around US$ 700 million) bringing the total disbursements under the SBA to US$ 1.9 billion.
— Ministry of Finance, Government of Pakistan (@Financegovpk) January 11, 2024
IMF’s $700 Million Loan Tranche to Bolster Economic Resilience
With the approval of this $700 million loan tranche, the total disbursements under the Stand-By Arrangement have now reached $1.9 billion, this financial injection is anticipated to fortify Pakistan’s economic resilience, especially when coupled with recent inflows from multilateral lenders. Topline Securities CEO, Mohammed Sohail, emphasized the positive impact of this funding on the stability of the Pakistani Rupee, which has shown signs of steadiness in recent months.
Paving the Way for Economic Rejuvenation
Expressing optimism, Mohammed Sohail pointed out that the new tranche would not only contribute to currency stability but also facilitate rollovers from friendly nations, alleviating external debt repayment pressures. The approval of the loan reflects a better approach to fiscal consolidation, cost-reducing reforms in the energy sector, a market-determined exchange rate, and structural changes in state-owned enterprises, this holistic approach is aimed at attracting investment, supporting job creation, and strengthening social assistance.
Read more: IMF Prepares to Assess Pakistan’s Eligibility for the Next $700 Million in Bailout Funds
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