Finance Minister Muhammad Aurangzeb told Reuters that Pakistan has begun negotiations with rating agencies to prepare for a return to the global debt markets and intends to finalize the terms of a fresh IMF loan in May.
The administration is looking for a longer and larger loan to assist bring permanency to macroeconomic stability as well as a cover under which the nation can undertake much-needed structural changes, according to the minister. The country’s existing $3 billion arrangement with the fund expires in late April.
During the International Monetary Fund and World Bank Spring Meetings on Wednesday, Aurangzeb met with the Fund’s Managing Director Kristalina Georgieva. “We expect the IMF mission to be in Islamabad around the middle of May—and that is when some of these contours will start developing,” he stated.
Although it is anticipated that Pakistan will request at least $6 billion, he did not specify the scope of the program the government intended to achieve.
Aurangzeb continued, saying that Pakistan will ask the Fund for more funding under the Resilience and Sustainability Trust as soon as the IMF loan was approved.
The financially strapped South Asian country has been able to build up its foreign exchange reserves recently, and by the end of June, it was expected to reach $10 billion, or around two months’ worth of import cover.
According to Aurangzeb, the debt situation also appeared more manageable.
Pakistan also intends to reenter global financial markets, maybe with a green bond. Still, Aurangzeb stated that more work needed to be done before that could occur.
