ISLAMABAD: Pakistan has requested the IMF to review another expansion program of one to one and a half billion dollars to meet the financial needs of long-term reforms to mitigate the effects of climate change.
Pakistani officials raised the issue of this new program under the name of The Resilience and Sustainability Facility (RSF) during a meeting between Prime Minister Shehbaz Sharif and MD Kristalina Georgievaki of the International Monetary Fund. This meeting took place on the sideline during the United Nations General Assembly session on Wednesday.
According to a statement issued by the Prime Minister’s Office on Thursday, Prime Minister Shehbaz Sharif has agreed that the Federal Finance Minister will raise this issue in the annual meeting of the IMF in October.
The statement added that after the approval of the $7 billion program by the IMF board, it has now become easier for Pakistan to get the facility for this new concessional loan. A few months ago, Pakistan requested the IMF for climate change financing, but the organization responded that Pakistan does not meet the criteria of the loan conditions. So now Pakistan has fulfilled the conditions of IMF after sanctioning seven billion dollar loan.
The Resilience and Sustainability Facility (RSF) is a concessional program with a 20-year repayment period. On the other hand, loans taken under the Extended Fund Facility Program have to be repaid in four to 10 years. During the meeting with the Prime Minister, the IMF MD praised his government for economic reforms.
Now is the time to fulfill the assurances given by the Government of Pakistan to the IMF. The first test is the privatization of PIA, whose bid date has been set for October 1. The IMF’s statement after approving the $7 billion program emphasized the need to reduce the size of government, which the IMF sees as a major obstacle to investment.
