IMF Staff Country Reports

This paper presents Pakistan’s First Review under the Extended Arrangement under the Extended Fund Facility (EFF), Requests for Modification of Performance Criteria, and Request for an Arrangement under the Resilience and Sustainable Facility (RSF). The IMF Executive Board completed the first review under the EFF Arrangement, allowing the authorities to draw the equivalent of about $1 billion. The authorities have demonstrated strong program implementation, which has contributed to improving financing and external conditions, and a continuing economic recovery. Moving forward, policy priorities will include advancing reforms to strengthen competition, raise productivity and competitiveness, reform state-owned enterprises, improve public service provision and energy sector viability, and build climate resilience. The State Bank of Pakistan’s (SBP) tight monetary policy stance has been pivotal in reducing inflation to historic lows. Monetary policy should remain appropriately tight and data-dependent to ensure inflation is anchored within the SBP’s target range. The Executive Board also approved the authorities request for an arrangement under the RSF, which will support Pakistan’s efforts in building economic resilience to climate vulnerabilities and natural disasters, with access of around $1.4 billion.