Islamabad : The International Monetary Fund (IMF) will support formulating a new economic programme for Pakistan if the new government seeks one, a spokesperson for the lender said on Friday, encouraging fair resolution of all electoral disputes.
The cash-strapped nation grappled with an uncertain Feb 8 election that delayed formation of a coalition government until new Prime Minister Shehbaz Sharif was sworn in on Monday, though a new finance minister has yet to be decided.
“We look forward to engaging with the new government to complete the second review under the current stand-by arrangement and, should the government request, support the formulation of a new medium-term economic program,” the Fund spokesperson said in an e-mail.
The reference was to a $3-billion standby arrangement Pakistan secured last summer from the IMF, though the country has been struggling with record inflation, currency devaluation and shrinking foreign reserves.
The party of jailed former prime minister Imran Khan asked the IMF last month to ensure an audit of the disputed February election before any more bailout talks with Islamabad.
The IMF said that while it did not comment on domestic political developments, it encouraged the fair and peaceful resolution of all electoral disputes, given the importance of the institutional environment for economic stability and growth.
The spokesperson said that “in terms of our engagement with Pakistan, our aim is to support the implementation of strong policies to deepen financial stability, address longstanding economic and underlying balance of payments challenges, and restore sustained and inclusive growth for the benefit of all Pakistani citizens”.
The statement highlighted that sustained growth could be achieved with “stronger public finances, through high quality revenue measures to broaden the tax base while scaling up the support for the most vulnerable, restoring energy sector viability, improving institutional governance and anti-corruption effectiveness”.
It also drew attention to reforms in state-owned enterprises (SOEs), building climate resilience, and creating a “level playing field for private businesses” to promote investment and employment for inclusive growth.
On the basis of these objectives, we look forward to engaging with the new government to complete the second review under the current Stand-by Arrangement and, should the government request, support the formulation of a new medium-term economic program.
The finance ministry and Khan’s party, Pakistan Tehreek-e-Insaf, did not immediately respond to a request for a comment.
Sharif has asked his government to open talks with the IMF for a new programme after clearing the stand-by arrangement.
