## News Brief: IMF Completes Second Review Under Pakistan's Stand-By Arrangement

_IMF News, July 11, 2001_

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## Bibliographic details
- Authors: Arrangement News Brief Related Links Pakistan
- Published: July 11, 2001

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### Review outcome and financing
- The Executive Board completed the second review under Pakistan's Stand-By Arrangement.
- Pakistan will be able to draw a further SDR 105 million (about US$131 million).
- Pakistan has so far drawn SDR 255 million (about US$324.6 million) under the Stand-By.
- The Stand-By Arrangement was first approved on November 29, 2000 (see Press Release No. 00/64).

### Waivers and performance criteria
- The Executive Board approved waivers for:
  - performance criteria on tax revenue collection; and
  - the elimination of interest subsidy element of the export finance scheme under the Arrangement.

### Assessment of program performance (statement by Eduardo Aninat, Deputy Managing Director and Acting Chairman)
- Achievements and macroeconomic outcomes:
  - "Pakistan's achievements under the program supported by the Stand-By Arrangement have been encouraging."
  - "The authorities have made a determined effort to implement the program, and most of the program targets have been achieved."
  - "Inflation has been better than expected, and the budget deficit remains in line with program assumptions."
  - "Economic activity was somewhat lower than expected because of severe drought, and this has contributed to lower-than-expected tax revenues and a weaker external balance."
  - "The implementation of important structural reforms has been well on track."

### Policy challenges and recommendations
- Fiscal policy and tax reform:
  - Implement the recently announced 2001/02 budget.
  - The 2001/02 budget includes a package of direct and indirect tax reforms aimed to:
    - broaden the tax base;
    - reduce distortions;
    - strengthen incentives for investment; and
    - reduce governance problems inherent to the current system.
  - Planned improvements of tax administration are expected to help boost collections, a key precondition for containing the fiscal deficit while increasing social and development spending.
- External sector and exchange rate policy:
  - Achieve targets for foreign exchange reserves.
  - This will require good coordination of monetary and exchange rate policies and further progress toward a genuinely market-based exchange rate policy.
- Structural and governance reforms:
  - Further improve governance in the management of public resources.
  - Continue restructuring public enterprises.
  - Strengthen the soundness of the financial system.

*Source: IMF News Brief, July 11, 2001.*

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## References

- [Pakistan and the IMF](http://www.imf.org/external/country/PAK/index.htm)
- [News Briefs](https://www.imf.org/en/news/searchnews)
- [Press Release No. 00/64](https://www.imf.org/external/np/sec/pr/2000/pr0064.htm)
- [https://www.imf.org/en/home](https://www.imf.org/en/home)

_Source: https://www.imf.org/en/news/articles/2015/09/29/18/03/nb0156_