No discussion on China-Pakistan deals in negotiations: IMF

By DTD- On Mar 29, 2024

The International Monetary Fund (IMF) has said that there was no discussion regarding Pakistan’s agreements with China.

Islamabad: No discussion on China-Pakistan deals in negotiations: IMF. The IMF sources revealed inside story of the meetings held with political parties in July 2023.

They said the IMF does not discuss bilateral agreements of member countries.

During the meeting, the stand-by arrangement agreement was discussed and it was suggested to freeze development budget to reduce the deficit. If the circular debt was not controlled, Pakistan would have to increase rates of utilities, the sources added.

They said the IMF termed Pakistan’s economic progress “encouraging,” but pointed out the challenges it was still facing. It urged Pakistan to deal with political instability for sustainable growth.

The donor expressed satisfaction at implementation of its recommendations in the stand-by agreement.

The sources said on-going stand-by arrangement agreement will expire in April after which new programme will be discussed. It is too early to say anything about the new loan programme, they added.

The IMF sources said that widening of tax revenues and tax base was necessary. The donor stressed on betterment in the energy sector.

There is a need to improve the transmission and distribution system, while prices have to be increased systematically so that inflation does not increase.

The sources said the donor left it up to Pakistan seek financial support from financial institutions and friendly countries.

The International Monetary Fund (IMF) is a major financial agency of the United Nations, and an international financial institution funded by 190 member countries, with headquarters in Washington, D.C. It is regarded as the global lender of last resort to national governments, and a leading supporter of exchange-rate stability. Its stated mission is “working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.” Established on December 27, 1945 at the Bretton Woods Conference, primarily according to the ideas of Harry Dexter White and John Maynard Keynes, it started with 29 member countries and the goal of reconstructing the international monetary system after World War II. It now plays a central role in the management of balance of payments difficulties and international financial crises. Through a quota system, countries contribute funds to a pool from which countries can borrow if they experience balance of payments problems. As of 2016, the fund had SDR 477 billion (about US$667 billion).