Pakistan: 2009 Article IV Consultation and First Review Under the Stand-By Arrangement: Staff Report; Staff Statement; Public Information Notice and Press Release on the Executive Board Discussion; and Statement by the Executive Director for Pakistan

IMF Staff Country Reports, April 13, 2009

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Canonical URL: Pakistan: 2009 Article IV Consultation and First Review Under the Stand-By Arrangement: Staff Report; Staff Statement; Public Information Notice and Press Release on the Executive Board Discussion; and Statement by the Executive Director for Pakistan

Pakistan has been facing significant economic difficulties.
Sharp increases in oil and food prices, and adverse security developments, contributed to:
- A significant widening of the fiscal deficit, owing in large part to increasing energy subsidies.
- Major pressures on the balance of payments.
- Considerable rises in inflation.
- Sharp declines in international reserves.
Executive Directors commended the authorities for the progress achieved under the stabilization program.
Directors welcomed the focus on social protection in the authorities’ program.

Drivers highlighted:
- Sharp increases in oil prices.
- Sharp increases in food prices.
- Adverse security developments.
Transmission and outcomes:
- Widening of the fiscal deficit, with energy subsidies identified as a major factor.
- Major pressures on the balance of payments.
- Considerable inflation increases.
- Sharp declines in international reserves.

Executive Directors:
- Commended progress under the stabilization program.
- Welcomed the authorities’ emphasis on social protection.
Subjects covered in the report include:
- Balance of payments
- Banking
- Credit
- Current account deficits
- Expenditure
- External debt
- Money
- Public debt