• Fund’s team to engage with key ministries, FBR, disaster agencies, provincial govts
• Policy review to follow next week to assess govt’s performance under Extended Fund Facility
• All but one structural benchmark ‘complete as of now’, sources say
ISLAMABAD: A technical mission from the International Monetary Fund (IMF) begins discussions in Islamabad today (Monday) on Pakistan’s request for over $1 billion in additional financing for climate resilience.
This will be followed by a policy review early next week to assess the authorities’ performance under the ongoing $7 billion Extended Fund Facility (EFF).
The technical team will engage mostly with key ministries, including planning, finance, climate change, petroleum, and water resources, as well as the Federal Board of Revenue, disaster management agencies and provincial governments.
Without going into specifics, the IMF resident representative in Islamabad, Mahir Binici, confirmed the engagements spanning over three weeks from now.
“An IMF staff team is scheduled to visit Pakistan in early to mid-March for discussions around the first review under Pakistan’s Extended Fund Facility-supported programme and the authorities’ request for assistance under a Resilience and Sustainability Facility (RSF) arrangement. In this regard, a technical team will be in Pakistan starting in late February to discuss technical issues related to a possible RSF arrangement,” he said.
Official sources said the relevant authorities, particularly the ministries of planning and finance, had prepared documentation for the Climate-Related Public Investment Management Assessment (C-PIMA) for coming budgets in line with policy advice of the IMF and the World Bank.
Talking about the first biannual review of the 39-month EFF, the sources said Pakistan had completed all but one structural benchmark as of now, although some indicative targets had been missed given the changing domestic and international macroeconomic conditions.
The only outstanding benchmark pertains to the required amendments to the Sovereign Wealth Fund (SWF) by the end of December, though other sub-conditions of these entities regarding governance structure and financial safeguards have already been met.
The planning ministry has also, of late, informed all the stakeholders, including federal ministries and provinces, about the criteria and methodology for the selection of projects in the future Public Sector Development Programme (PSDP) projects.
Starting the upcoming budget, factors to be considered for project selection for PSDP would include strategic and core ongoing projects, ongoing projects with over 80 per cent expenditure with realistic completion estimate, exceptional and high-scoring infrastructure projects, pre-scrutinised approved projects at working-party levels, foreign-funded projects with adequate rupee cover allocation and provincial projects in 20 least-developed districts. On top of this, climate-responsive and resilient projects would also be part of the PSDP.
The funding under RSF is made available to nations who commit high-quality reforms to build resilience against climate catastrophes through adaptation and is repayable over a 30-year period, including a 10-year grace period and is normally cheaper than EFF terms. In October last year, Pakistan formally requested the IMF to top up its $7bn EFF with another $1.2bn RSF.
