{
  "title": "IMF Executive Board Completes Second and Final Review of the Stand-By Arrangement for Pakistan",
  "publication": "IMF News, April 29, 2024",
  "sourceUrl": "https://www.imf.org/en/news/articles/2024/04/29/pr24130-pakistan-imf-executive-board-completes-second-and-final-review-sba",
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  "summary": "Today, the Executive Board of the International Monetary Fund (IMF) completed the second and final review of Pakistan’s economic reform program supported by the IMF’s Stand-By Arrangement (SBA).",
  "publishDate": "2024-04-29",
  "sections": [
    {
      "heading": "Review outcome and disbursement",
      "content": "- The Executive Board completed the second and final review of Pakistan’s economic reform program under the IMF’s Stand‑By Arrangement (SBA).\n- Immediate disbursement: SDR 828 million (around $1.1 billion).\n- Total disbursements under the arrangement: SDR 2.250 billion (about $3 billion).\n- Pakistan’s 9‑month SBA was approved by the Executive Board on July 12, 2023."
    },
    {
      "heading": "Program focus and objectives",
      "content": "- Program priorities included:\n  - Necessary fiscal adjustment and maintenance of debt sustainability via FY24 budget implementation.\n  - Protection of critical social spending.\n  - Buffering external shocks and eliminating FX shortages by returning to proper FX market functioning.\n  - Making progress on disinflation by maintaining a tight monetary policy.\n  - Furthering structural reforms focused on energy sector viability, SOE governance, and climate resilience.\n- The SBA served as a policy anchor to address domestic and external imbalances and as a framework for financial support from multilateral and bilateral partners."
    },
    {
      "heading": "Macroeconomic developments and outlook",
      "content": "- Growth:\n  - Growth of 2 percent is expected in FY24 given continued recovery in the second half of the fiscal year.\n- Fiscal performance:\n  - Primary surplus of 1.8 percent of GDP achieved in the first half of fiscal year 2024.\n  - On track to achieve end‑FY24 target primary surplus of 0.4 percent of GDP.\n- Inflation:\n  - Inflation, while still elevated, continues to decline and is expected to reach around 20 percent by end‑June.\n  - With appropriately tight, data‑driven monetary policy maintained, inflation should return to the SBP’s target over the medium term.\n- External position:\n  - Gross reserves increased to around $8 billion, up from $4.5 billion at the start of the program, and are projected to continue being rebuilt over the medium term.\n  - Continued improvements in FX market functioning and a market‑determined exchange rate are emphasized to buffer shocks and attract financing.\n- Financial sector:\n  - Need for stronger action to address undercapitalized financial institutions and vigilance to ensure financial stability."
    },
    {
      "heading": "Policy recommendations and priorities (Antoinette Sayeh)",
      "content": "- Persevere beyond the current arrangement with sound macroeconomic policies and structural reforms to create stronger, inclusive, and sustainable growth.\n- Continued external support will be critical.\n- Fiscal policy:\n  - Continue revenue mobilization efforts and spending discipline at both federal and provincial levels to ensure primary surplus targets are achieved.\n  - Further mobilize revenues, especially from non‑filers and undertaxed sectors, and improve public financial management to secure fiscal sustainability and space for social and development spending beyond FY2024.\n- Energy sector:\n  - Continue timely tariff adjustments and enhanced collection efforts.\n  - Undertake cost‑side reforms to address underlying issues and sector viability.\n- Monetary and FX policy:\n  - Maintain the State Bank of Pakistan’s tight monetary policy stance until inflation returns to more moderate levels.\n  - Foster a market‑determined exchange rate to help buffer external shocks and support competitiveness and growth.\n  - Continue significant rebuilding of FX reserves.\n- Structural reforms and social protection:\n  - Accelerate structural reforms and protect the most vulnerable through an adequately‑financed Benazir Income Support Program.\n  - Priorities include advancing SOE reform to ensure all SOEs fall under the new policy framework; strengthening governance and anti‑corruption institutions; and building climate resilience."
    },
    {
      "heading": "Key statistics and selected indicators",
      "content": "- Population: 231.6 million (2022/23)\n- Per capita GDP: US$1,446.3 (FY2023)\n- Quota: SDR 2,031 million\n- Poverty rate: 21.9 percent\n- Main exports: Textiles (US$16.5 billion, 2022/23)\n- Key export markets: European Union, United States, UAE\n\n- Table 1. Pakistan: Selected Economic Indicators, FY2023–FY2025 (selected series)\n  - Real GDP at factor cost: FY2023 -0.2; FY2024 2.0; FY2025 3.5\n  - Unemployment rate: FY2023 8.5; FY2024 8.0; FY2025 7.5\n  - Consumer prices, period average: FY2023 29.2; FY2024 24.8; FY2025 12.7\n  - Consumer prices, end of period: FY2023 29.4; FY2024 19.6; FY2025 9.5\n  - Revenue and grants (% GDP): FY2023 11.4; FY2024 12.5; FY2025 12.4\n  - Expenditure (% GDP): FY2023 19.2; FY2024 20.0; FY2025 19.8\n  - Budget balance, including grants (% GDP): FY2023 -7.8; FY2024 -7.4\n  - Primary balance, excluding grants (% GDP): FY2024 0.4\n  - Total general government debt excl. IMF obligations (% GDP): FY2023 74.7; FY2024 69.6; FY2025 68.1\n  - External general government debt (% GDP): FY2023 28.5; FY2024 26.2; FY2025 25.0\n  - Domestic general government debt (% GDP): FY2023 46.2; FY2024 43.3; FY2025 43.2\n  - General government debt incl. IMF obligations (% GDP): FY2023 77.1; FY2024 72.1; FY2025 70.0\n  - General government and government guaranteed debt incl. IMF (% GDP): FY2023 81.3; FY2024 76.0; FY2025 73.6\n  - Broad money (% change): FY2023 14.2; FY2024 13.5; FY2025 22.0\n  - Private credit (% change): FY2023 2.3; FY2025 (not listed for FY2024)\n  - Six‑month treasury bill rate (period average) (%): FY2023 18.3\n  - Current account balance (% GDP): FY2023 -0.7; FY2024 -1.2\n  - Foreign direct investment (% GDP): FY2023 0.5; FY2024 0.2; FY2025 0.3\n  - Gross reserves (millions of U.S. dollars): FY2023 4,455; FY2024 9,029; FY2025 13,364\n  - Months of next year's imports of goods and services: FY2023 0.8; FY2024 1.5; FY2025 2.1\n  - Total external debt (% GDP): FY2023 40.1; FY2024 36.6; FY2025 34.7\n  - Real effective exchange rate: FY2023 -8.0\n\nIMF Press Release No. 24/130, April 29, 2024.\n\n---\n\n\n References\n\n- https://www.imf.org/en/about/senior-officials/bios/antoinette-monsio-sayeh\n- Pakistan and the IMF\n- Special Drawing Rights (SDRs) -- A Factsheet\n- Press Releases\n- PRESS CENTER\n- Stand-By Arrangement\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2024/04/29/pr24130-pakistan-imf-executive-board-completes-second-and-final-review-sba"
    }
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    "Published: April 29, 2024",
    "The Executive Board completed the second and final review of Pakistan’s economic reform program under the IMF’s Stand‑By Arrangement (SBA).",
    "Immediate disbursement: SDR 828 million (around $1.1 billion).",
    "Total disbursements under the arrangement: SDR 2.250 billion (about $3 billion).",
    "Pakistan’s 9‑month SBA was approved by the Executive Board on July 12, 2023.",
    "Program priorities included:",
    "The SBA served as a policy anchor to address domestic and external imbalances and as a framework for financial support from multilateral and bilateral partners.",
    "Growth:",
    "Fiscal performance:",
    "Inflation:",
    "External position:",
    "Financial sector:",
    "Persevere beyond the current arrangement with sound macroeconomic policies and structural reforms to create stronger, inclusive, and sustainable growth.",
    "Continued external support will be critical.",
    "Fiscal policy:",
    "Energy sector:",
    "Monetary and FX policy:",
    "Structural reforms and social protection:",
    "Population: 231.6 million (2022/23)",
    "Per capita GDP: US$1,446.3 (FY2023)",
    "Quota: SDR 2,031 million",
    "Poverty rate: 21.9 percent",
    "Main exports: Textiles (US$16.5 billion, 2022/23)",
    "Key export markets: European Union, United States, UAE",
    "Table 1. Pakistan: Selected Economic Indicators, FY2023–FY2025 (selected series)",
    "[https://www.imf.org/en/about/senior-officials/bios/antoinette-monsio-sayeh](https://www.imf.org/en/about/senior-officials/bios/antoinette-monsio-sayeh)",
    "[Pakistan and the IMF](http://www.imf.org/external/country/PAK/index.htm)",
    "[Special Drawing Rights (SDRs) -- A Factsheet](https://www.imf.org/en/about/factsheets/sheets/2023/special-drawing-rights-sdr)",
    "[Press Releases](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[Stand-By Arrangement](https://www.imf.org/en/About/Factsheets/Sheets/2023/Stand-By-Arrangement-SBA)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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