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The IMF reached a staff-level agreement with Pakistan.

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9 months ago

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According to an official statement published by an International Monetary Fund team led by Nathan Porter, the IMF secured a staff-level agreement with Pakistan on the second and final assessment of the country’s stabilisation programme, which is funded by the IMF’s US$3 billion (SDR2,250 million) SBA loan.

The deal is subject to confirmation by the IMF’s Executive Board, following which the remaining SBA access of US$1.1 billion (SDR 828 million) will become accessible.

Porter claimed that “Pakistan’s economic and financial situation has improved in the months since the first review, with growth and confidence continuing to recover as a result of prudent policy management and the resumption of inflows from multilateral and bilateral partners.” However, growth is expected to be modest this year, and inflation remains well above target. Continued policy and reform efforts are required to address Pakistan’s deep-seated economic vulnerabilities in the face of ongoing challenges posed by elevated external and domestic financing needs and an unsettled external environment.”

According to the IMF’s official statement, “the new government is committed to continuing the policy efforts that began under the current SBA to establish economic and financial stability for the remainder of this year.” In particular, the authorities are determined to deliver the FY24 general government primary balance target of PRs 401 billion (0.4 percent of GDP), with further efforts to broaden the tax base, and to continue with the timely implementation of power and gas tariff adjustments to keep average tariffs consistent with cost recovery while protecting the vulnerable through the existing progressive tariff structures, thus avoiding any net circular debt (CD) accumulation. The State Bank of Pakistan remains dedicated to implementing a prudent monetary policy to reduce inflation while also ensuring exchange rate flexibility and transparency in FX market operations.

In addition, Pakistan expressed interest in a successor medium-term Fund-supported programme aimed at permanently resolving Pakistan’s fiscal and external sustainability weaknesses, strengthening its economic recovery, and laying the groundwork for strong, sustainable, and inclusive growth.

While these discussions are scheduled to begin in the next few months, important objectives will be included.

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In interbank trade, the Pakistani rupee beats the US dollar.

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5 days ago

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In the international exchange market, the US dollar has continued to weaken in relation to the Pakistani rupee.

The dollar fell to Rs278.10 from Rs278.17 at the beginning of interbank trading, according to currency dealers, a seven paisa loss.

In the meantime, there was a lot of turbulence in the stock market, but it recovered and moved into the positive zone. The KSE-100 index recovered momentum and reached 116,000 points after soaring 1,300 points.

Both currency and stock market swings, according to analysts, are a reflection of ongoing market adjustments and economic uncertainty.

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Phase II of CPEC: China-Pakistan Partnership Enters a New Era

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6 days ago

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The cornerstone of economic cooperation between the two brothers and all-weather friends is still the China-Pakistan Economic Corridor, the initiative’s flagship project.

In contrast to reports of a slowdown, recent events indicate a renewed vigour and strategic emphasis on pushing the second phase of CPEC, known as CPEC Phase-2, according to the Ministry of Planning, Development, and Special Initiatives.

According to the statement, this crucial stage seeks to reshape the foundation of bilateral ties via increased cooperation, cutting-edge technology transfer, and revolutionary socioeconomic initiatives.

Planning Minister Ahsan Iqbal is leading Pakistan’s participation in a number of high-profile gatherings in China, such as the 3rd Forum on China-Indian Ocean Region Development Cooperation in Kunming and the High-Level Seminar on CPEC-2 in Beijing.

His involvement demonstrates Pakistan’s commitment to reviving CPEC, resolving outstanding concerns, and developing a strong phase-2 roadmap that considers both countries’ long-term prosperity.

At the core of these interactions is China’s steadfast determination to turn CPEC into a strategic alliance that promotes development, progress, and connectivity.

Instead of being marginalised, CPEC is developing into a multifaceted framework with five main thematic corridors: the Opening-Up/Regional Connectivity Corridor, the Innovation Corridor, the Green Corridor, the Growth Corridor, and the Livelihood-Enhancing Corridor.

With the help of projects like these, the two countries will fortify their partnership, and CPEC phase-2 will become a model of global economic integration and collaboration that benefits not just China and Pakistan but the entire region.

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The inflation rate in Pakistan dropped to its lowest level.

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6 days ago

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On December 2, core inflation as determined by the Consumer Price Index (CPI) significantly slowed, falling to 4.9% in November 2024 from 7.2 percent in October 2024.

The CPI-based inflation rate for the same month last year (November 2023) was 29.2%, according to PBS data.

Compared to a 1.2% gain in the prior month, it increased by 0.5% month over month in November 2024.

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