IMF chief talks of accord on Pakistan loan review ‘any day now’
Praises Pakistan govt for sticking to programme: Urges Islamabad to improve tax collection to sustain development
By News Desk
November 15, 2023 03:25 PM
The International Monetary Fund (IMF) is close to striking an agreement with Pakistan on the first review of its $3 billion loan programme, the IMF Managing Director Kristalina Georgieva said on Wednesday.
In an interview with Bloomberg TV, the IMF chief praised the Pakistani authorities for sticking to the programme despite the political and economic challenges. She also urged them to improve their tax collection to sustain the country’s development.
“I expect an agreement on the review to come within this week,” said Georgieva during the interview.
The IMF mission, led by Nathan Porter, is currently in Pakistan to conduct the review of the Stand-By-Arrangement (SBA) that was approved in July to help the country avoid a sovereign debt default.
Pakistan has received $1.2 billion as the first tranche of the loan and is expected to get another $450 million after the completion of the review.
Georgieva said that Pakistan’s tax-to-GDP ratio, which is around 12%, needs to increase to at least 15% to generate enough revenues for the government.
In Pakistan, the primary issue is tax collection, Georgieva told Bloomberg TV, adding that the IMF is asking Islamabad for tax collections to be at least 15 percent of gross domestic product (GDP) against 12 percent in collections currently.
The IMF mission concludes its visit to Islamabad on Wednesday.