The Ministry of Finance officially started negotiations with the International Monetary Fund (IMF) Mission on Monday, officially starting the third round of the Extended Fund Facility (EFF) programme and the second round of the Resilience and Sustainability Facility (RSF) programme.
“In Pakistan, a mission of the IMF headed by Iva Petrova has already begun negotiations with the Karachi and Islamabad authorities over the third review of Pakistan’s EFF set up and the second review of the RSF,” Mahir Binici, Resident Representative in Pakistan, informed Business Recorder.
“Virtual meetings will be conducted,” he said.
The meeting, however, initiated the in-depth discussions between the Pakistani authorities and the IMF officials on the performance standards, fiscal and macroeconomic indicators at large.
The talks are planned to go on until March 11.
The mission will determine the economic performance of Pakistan in the period between July and December 2025 and begin negotiations on the release of the next tranche under the EFF and the RSF.
The fund’s mission, according to the officials, will focus on tax collection, energy sector reforms and the privatisation programme progress. The issue of governance and anti-corruption practices will also be discussed, especially the transparency in the appointments of key institutions.
Upon reaching an agreement of the third review by IMF staff with the Pakistani authorities under the EFF and the second review by IMF staff under the RSF, the same agreement will be submitted to the approval of the IMF Executive Board.
When it is approved, Pakistan will be eligible to receive USD 1 billion in the EFF and USD 200 million in the RSF. The two arrangements have already provided USD 3.3 billion to Pakistan.
Finance Minister Muhammad Aurangzeb last week gave a positive statement concerning the fiscal management of the government, saying that Pakistan was in a good position, especially regarding the collection of taxes.
Meanwhile, the Pakistan Business Council (PBC), during a sit-down with the visiting IMF delegation, has noted that there is positive gain being made in terms of inflation control and fiscal consolidation in the current Board programme, but under macroeconomic stabilisation, it is now needed to produce economic benefits.
The PBC further recommended doing away with the super tax, reducing the corporate tax rate to 25 per cent over a period of time and rationalisation of the advance and withholding taxes that are actually minimum taxes.
