PBC urges authorities to augment IMF programme

The Pakistan Business Council (PBC) has welcomed the development regarding arrival of the International Monetary Fund (IMF) mission, while urging authorities to seek an “extension and augmentation” of the bailout programme.

Taking to social media on Friday, the business advocacy platform said the imminent arrival of the IMF team and likely programme revival are welcome.

“We should commence talks for extension and augmentation as current programme is insufficient,” it added.

The statement comes as the IMF said its mission will visit Pakistan from January 31-February 9 to continue discussions for the 9th review under the Extended Fund Facility (EFF).

This was confirmed by IMF Resident Representative Esther Perez Ruiz to Business Recorder on Thursday.

She added that the mission will focus on policies to restore domestic and external sustainability, including strengthening the fiscal position with durable and high-quality measures while supporting the vulnerable and those affected by the floods; restoring the viability of the power sector and reversing the continued accumulation of circular debt; and reestablish the proper functioning of the forex market, allowing the exchange rate to clear the FX shortage.

Meanwhile, the PBC said that the authorities should also seek expert advice to re-profile their debts.

“Most of all, cross-party agreement on reforms through long-term policies; widen the tax base; energy reforms; restructure and privatize State-owned Enterprises SOEs; broaden the export basket/diversify geographic reach; renegotiate National Finance Commission (NFC); build self-reliance for food & energy; deregulate/digitize civil service to make it easier, less costly and quicker to do business,” added the PBC.

Experts have highlighted that the resumption of the IMF programme is crucial for Pakistan, which is desperately looking to improve its inflows as foreign exchange reserves held by the State Bank of Pakistan (SBP) dropped a massive $923 million to a mere $3.7 billion, data released on Thursday showed.

This is the lowest level of SBP-held reserves since February 2014.