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[ad_1] ISLAMABAD: Top government functionaries, while explaining that the authorities would not inquire about the source of income on foreign remittances up to $100,000, on Monday ruled out any freeze on the $5.4 billion in private foreign currency accounts (FCAs) as part of the ‘Plan-B’. The statements made in the Senate Standing Committee on Finance, and immediately after its meeting, underscore the growing challenges that the authorities face, while remaining afloat without the International Monetary Fund (IMF) umbrella. So far, there was no proposal under consideration at any government level to freeze the foreign currency accounts of the citizens, Dr Aisha Pasha, the minister of state for finance, stated categorically after the committee meeting. She was asked to comment whether there was any proposal to freeze the $5.4 billion foreign currency accounts, if Pakistan remained unable to revive the derailed $6.5 billion IMF programme. She further clarified that Prime Minister...

[ad_1] The International Monetary Fund’s (IMF) criticism of Pakistan’s latest budget suggests chances are rising that the lender will opt not to deliver long-awaited aid before its bailout programme finishes at the end of June, Bloomberg reported. “This would cause a severe dollar shortage in the first half of the fiscal year that starts in July, and possibly for longer — significantly raising the odds of default, Bloomberg economist Ankur Shukla said in the report, Pakistan Insight. “It would also raise the prospect of much lower growth, and higher inflation and interest rates than we currently anticipate in fiscal 2024.” The IMF criticised the budget for not taking enough steps to broaden the tax base and for including a tax amnesty. The country’s foreign currency reserves currently stand at $4 billion. With at least around $900 million in debt that must be repaid this month, the reserves will fall by June-end unless the IMF aid comes. Between July-December, Pakistan mus...

[ad_1] ISLAMABAD: The interim federal government has decided to reduce spending on a massive scale in order to show a surplus of Rs600 billion on behalf of the provinces during the current fiscal year and to meet the International Monetary Fund’s (IMF) condition of reducing the financial deficit of the Centre. It has also been agreed that any new projects under the annual development programme would not be launched. The finance ministry sources said the caretaker government had made this decision because of the difficult financial situation of the country. The Special Investment Facilitation Council (SIFC) also backed the proposal. The federal government decided not to launch any new schemes under the Annual Development Programme in the current fiscal year to reduce the expenses. However, the financial needs of the ongoing development projects will be met. According to the sources, it has been decided to take the share in the subsidy of electricity, gas, wheat and fertili...

[ad_1] The International Monetary Fund (IMF) on Wednesday asked Pakistan to share the plan in writing to provide relief in electricity bills as the protests continue countrywide. According to media report, the development comes after the caretaker government decided to seek the lender's nod before announcing any relief to the consumers. A meeting of the federal cabinet was held on Tuesday with interim Prime Minister Anwaarul Haq Kakar in the chair to mull options but ended without announcing any measures. The Power Division shared its proposals with the authorities but due to strict IMF loan conditions, it was concluded that the lender should be taken on board first. Islamabad had signed a $3 billion loan agreement with the Fund in July and agreed to stringent financial discipline during the programme. Under the bailout package, the previous government of the Pakistan Democratic Movement okayed a massive increase in electricity rates which are now being reflected in th...

[ad_1] KARACHI: Pakistan has won back confidence of global investors as the country risk premium fell significantly from the peak of over 14% in June while its dollar-denominated Eurobond prices rose notably. Topline Securities CEO Mohammed Sohail said on social media platform X “Pakistan’s country risk premium has fallen significantly from its peak of 14.13% on June 27, 2023 to the current level of 3.35%. This shows building investor confidence in Pakistan post-IMF standby arrangement (SBA).” The reduction in risk premium signals the revival of global investors’ trust in Pakistan’s equity and debt instruments from the earlier negative stance. On the other hand, prices of Pakistan’s Eurobonds worth $1 billion maturing in April 2024 surged to 94.08 cents from near 50 cents in June. Prices of other Eurobonds and Sukuk also maintained their uptrend since the IMF awarded a $3 billion loan programme at the end of June 2023. Talking to The Express Tribune, Pak-Kuwait Investment ...

[ad_1] KARACHI: The State Bank of Pakistan (SBP) is mulling over monetary policy decision this week. The economic contraction is so severe that this entire fiscal year will be marred with economic, social and political chaos. Entire population – educated or not – is either discussing dollar rate or inflationary trends in fuel and food prices. Granted that central bank’s primary job constitutes reining in inflation, but will the expected interest rate hike solve the problems or add to them? Firstly, inflation in Pakistan is not led by excessive demand (demand-pull). Purchasing power is negligible and neither is economy overheating to create shortages or abnormal profits. Domestic inflationary wave is driven by currency depreciation, utility price hikes, global food prices and administrative failures (cost-push). Secondly, inflation is not an outcome of excessive money supply in the country. Surely, exorbitant cash in circulation is not returning back to formal channels with a...

[ad_1] WASHINGTON: China's agreement to restructure its loans to Sri Lanka paves the way for International Monetary Fund financing to the bankrupt island nation, the IMF said Tuesday, adding this would also speed up funding from others. "Sri Lanka has now received financing assurances from all major bilateral creditors," said Krishna Srinivasan , director of IMF's Asia and Pacific Department. This allows the fund's board to approve a loan earlier agreed upon by its staff. [ad_2] Source link https://worldnews2023.com/business/imf-china-backing-paves-way-for-sri-lanka-financing-imf-times-of-india/?feed_id=294302&_unique_id=6604deab127d2

[ad_1] ISLAMABAD: After the rejection of the first one, the caretaker government has sent a fresh proposal to the International Monetary Fund (IMF) that the additional money allocated for the independent power producers (IPPs) could be adjusted to provide relief to the consumers, who were protesting against the exorbitant rise in their electricity bills. Finance ministry sources said under the new plan, an amount of over Rs15 billion would be allocated back to IPPs after receiving instalments from the bills. The sources added that the finance ministry officials would discuss the fresh plan with the IMF again. In the new plan, the IMF has been assured that no relief outside the budget will be given to the people. The IMF had rejected an earlier plan sent to it by the caretaker government for providing relief to the power consumers. The global lender while snubbing the relief plan, said it would have an impact of over Rs15 billion, not Rs5 billion, as Pakistan had suggested i...

[ad_1] ISLAMABAD: Pakistan’s decades-old policies that give preferential access to state resources to a select few sectors and ensure strong government footprints have placed it among nations that have the lowest inclusive growth and low access to education and healthcare, endangering the unparalleled demographic dividends. A book of the International Monetary Fund (IMF), “Promoting Inclusive Growth in the Middle East and North Africa: Challenges and Opportunities in a Post-Pandemic World”, outlines the prevailing poor economic conditions in a part of the world to which Pakistan also belongs. The countries that have the lowest inclusive growth scores are Yemen, Mauritania and Pakistan. They lag behind other countries in the private sector and financial inclusion the most. In terms of access to education, Iran, Jordan, Egypt, Morocco, Lebanon, and Pakistan rank below average for the rest of the world. Within the region, Mauritania, Pakistan and Yemen are the ones that most se...

[ad_1] ISLAMABAD: Pakistan is likely to seek a waiver from the International Monetary Fund (IMF) for violating the condition of restricting the difference between inter-bank and open market currency rates as the lender improves its assumption for the average dollar price to Rs300. Highly placed sources said that compared to July’s underlying assumption of Rs305.2 to a dollar, the IMF “is now assuming the average price of US currency at a little below Rs300 by June next year”. They said that due to the breach of the condition of keeping the gap between currency rates at banks and foreign exchange companies at 1.25%, Pakistan would have to secure a waiver from the IMF board for qualifying for the next loan tranche. It is expected that Pakistani authorities will win the wavier as the global lender seems positive about gradual improvements in the currency exchange market. Pakistan and the IMF have already concluded a staff-level agreement that will be followed by the board’s app...

[ad_1] KARACHI: Pakistan Stock Exchange (PSX) maintained its upward march and broke records in the outgoing week when it climbed over 2,000 points as investors cheered reports of encouraging economic and earnings outlook and expected release of the second loan tranche of $700 million by the International Monetary Fund (IMF). A key event was the easing of weekly inflation, measured by the Sensitive Price Indicator (SPI), by 0.06%, which boosted investors’ confidence. During the week, the KSE-100 index crossed the 59,000-point barrier for the first time in history and touched record highs. Among worrying factors for investors was the rupee’s continuous topsy-turvy movement, shrinking foreign exchange reserves and gas tariff hike. At the beginning of the week, the bourse closed with marginal gains amid a range-bound session as uncertainties surrounding the potential hike in industrial gas and power tariffs weighed on investors’ mind, though weaker global crude oil prices prov...

[ad_1] A National Assembly session is under way to pass a crucial tax amendment bill to fulfil the conditions of the International Monetary Fund (IMF) to revive a stalled loan programme that the country needs to stave off default. Finance Minister Ishaq Dar introduced the Finance (Supplementary) Bill 2023. Addressing the lower house of parliament, Dar compared the performance of the previous PML-N and PTI governments. He said that during former prime minister Nawaz Sharif’s tenure, the GDP per capita increased while the Pakistan Stock Exchange’s (PSX) market capitalisation was $100 billion. However, the PSX’s market capitalisation declined to $26bn during the PTI government, he said, adding that the decrease showed a lack of investor confidence in the previous government. Dar also criticised the PTI government for increasing the country’s debts significantly. “In 2017-18, GDP growth had surpassed six per cent, inflation was at 5pc, food inflation at 2pc … After the 2018 el...

[ad_1] Finance Minister Ishaq Dar on Friday said that the State Bank of Pakistan (SBP) has received $700 million from the China Development Bank (CDB) in a much-needed boost to forex reserves as the country grapples with a worsening economic crisis. The finance minister took to Twitter to make the announcement. "AlhamdoLilah! Funds $700 million received today by State Bank of Pakistan from China Development Bank". In an earlier tweet, Dar had maintained that the loan would "shore up" Pakistan's foreign exchange reserves. Formalities completed and Board of China Development Bank has approved the facility of US $ 700 million for Pakistan. This amount is expected to be received this week by State Bank of Pakistan which will shore up its forex reserves! — Ishaq Dar (@MIshaqDar50) February 22, 2023 Earlier this month, the country's foreign exchange reserves slipped to the alarming level of below $3 billion for the first time in nine years, reducing...

[ad_1] The International Monetary Fund (IMF) said that it will "continue engagement with the government on the loan despite the ramp-up in political tensions”,  Bloomberg reported on Thursday. The remarks by the IMF come days after former prime minister Imran Khan was arrested from the Islamabad High Court (IHC) on May 9 in the Al-Qadir Trust case, leading to political unrest in the country.  The Bloomberg report also maintained that the international money lender said that Pakistan will scrap a new fuel subsidy proposal, a decision that potentially clears a hurdle to unlock a long-delayed $1.1 billion loan disbursement, In response to email questions, an IMF spokesperson said that Pakistan had “committed not to implement a so-called cross-subsidy programme in the current fiscal year and beyond”. The IMF added that the incumbent government would not introduce new tax exemptions and would “durably allow” a market-based exchange rate for its currency, the rupee. Read Gov...

[ad_1] ISLAMABAD: The International Monetary Fund (IMF) on Tuesday kept Pakistan’s economic growth forecast unchanged at 2.5% but slashed inflation rate to 23.6% for the current fiscal year, in a move that is largely in line with official projections. The global lender released its flagship report, the World Economic Outlook, at the start of annual meetings in Morocco. It left Pakistan’s economic growth projection unchanged at 2.5%, which is lower than the official target by 1%. But it is consistent with the figure the IMF gave in its last report. Like the World Bank, the IMF did not accept Pakistan’s 0.3% GDP growth claim for last year. The new report has shown an economic contraction of 0.5% in the previous fiscal year, which was the last year of the Pakistan Democratic Movement (PDM) government. The previous government had pressurised the Pakistan Bureau of Statistics (PBS) to show a positive growth. The 2.5% growth projection is the highest by any international financi...

[ad_1] Finance Minister Ishaq Dar said on Thursday that Pakistan’s negotiations with the International Monetary Fund (IMF) related to the completion of the ninth review of a $7 billion loan programme were near conclusion and the staff-level agreement with the global lender will be signed by next week. The government is in a race against time to implement measures to reach an agreement with the IMF as the country has reserves barely enough for three weeks of essential imports, while hotly contested elections are due by November. In a series of tweets today, the finance czar rubbished rumours regarding Pakistan defaulting. “Anti-Pakistan elements are spreading malicious rumours that Pakistan may default. This is not only completely false but also belies the facts,” he said. Dar said that the State Bank of Pakistan’s (SBP) forex reserves had been increasing and were almost near $1 billion, “higher than four weeks ago despite making all external due payments on time”. “Foreign...

[ad_1] Finance Minister Ishaq Dar Friday reiterated his commitment to transparency and accountability in financial matters, particularly concerning the Extended Fund Facility (EFF) agreement with the International Monetary Fund (IMF). During his address to the National Assembly session, the minister said: “Any important developments in the country should be presented in the assembly”. “I will bring the documents of the IMF agreement in this House as the Finance Minister,” Dar asserted, assuring the lawmakers and the public that he would make the necessary documents available for scrutiny and review. Regarding the Letter of Intent, Dar revealed that it had been signed on June 30. He asserted that the MEFP (Memorandum of Economic and Financial Policies) and PFP (Policy Framework Paper) were attached to the Letter of Intent. He announced his intention to keep one copy of the three documents associated with the agreement in the assembly library, making them accessible to all m...

[ad_1] ISLAMABAD: The International Monetary Fund (IMF) has slapped a stringent condition on Pakistan to stop its intervention in the exchange rate market and also said that the risks to the new $3 billion programme implementation were “exceptionally high”. The global lender on Tuesday released its staff report on the $3 billion Stand-by Arrangement (SBA) that also appeared in a charge sheet against the government over its poor handling of the economy during the past year. The report revealed how the government distorted the exchange rate market and the central bank lacked clarity when the pressures were increasing. Pakistan accepted 10 major conditions in addition to accepting 13 other performance and indicative targets in return for the $3 billion package for July 12 to April 2024 period, the report showed. The IMF said that the length of the SBA is also tailored to leave space for the new government to embark on a fresh programme, if it so wishes, enhancing ownership. ...

[ad_1] The International Monetary Fund’s (IMF) Director of Strategic Communications Julie Kozack has said that "steadfast implementation" of the nine-month Stand-by Arrangement ( SBA ) was critical to Pakistan's future. "Steadfast implementation is critical to address its large financing needs & support the most vulnerable," she said in a statement on Thursday. The Stand-By Arrangement (SBA) for Pakistan 🇵🇰 comes at a challenging juncture. It aims to stabilize the economy & address the needs of the Pakistani people. Steadfast implementation is critical to address its large financing needs & support the most vulnerable. pic.twitter.com/2BfDQxvih2 — Julie Kozack (@IMFSpokesperson) July 13, 2023 "The SBA is aimed at supporting the authorities' immediate efforts to stabilise the economy," she said, "and also to ensure that the current balance of payments need is filled. "While it is a relatively short programme, it...