Pakistan has been asked by the International Monetary Fund (IMF) to arrange fresh loans worth $8 billion to support external debt repayments over the next seven months.
Despite receiving confirmation from Saudi Arabia and the United Arab Emirates (UAE), the IMF has asked for $6 billion in external financing to be arranged by June 2023 to avoid default. The delay in arranging these funds has caused the ninth programme review worth $1.2 billion to remain incomplete.
Pakistan’s Finance Minister, Ishaq Dar, has stated that the government will not make any more tough decisions on IMF’s demand anymore. He clarified that Pakistan has already implemented the pre-conditions of the IMF. This comes after the IMF spokesperson, Julie Kozack, stated that Pakistan needed “significant additional financing” to successfully complete the ninth review, with the economy facing stagflation and very large financing needs, compounded by a series of shocks, including severe flooding.
Although the United Arab Emirates, Saudi Arabia, and China have pledged to cover some of the funding deficit, the IMF is requesting further arrangements be made to secure the repayment of debts.
