Pakistan’s economic program is off to a promising start, but decisive implementation is critical to pave the way for stronger and sustainable growth, said a statement issued by the IMF at the conclusion of the monetary body’s visit to Pakistan on Friday.
The IMF mission will return to Pakistan in late October to conduct the first review under the Extended Fund Facility.
The mission, led by Ernesto Ramirez Rigo, visited Islamabad and Karachi from September 16 to September 20 to take stock of economic developments since the start of the Extended Fund Facility and discuss progress in the implementation of economic policies.
At the conclusion of the staff visit, Rigo issued a statement saying that while the economic reform programme is still in its early stages, there has been progress in some key areas. “The transition to a market-determined exchange rate has started to deliver positive results on the external balance, exchange rate volatility has diminished, monetary policy is helping to control inflation, and the SBP has improved its foreign exchange buffers,” read his statement.
He said there has been a significant improvement in tax revenue collections, with taxes showing double-digit growth net of exporters refunds.
“The near-term macroeconomic outlook is broadly unchanged from the time of the programme approval, with growth projected at 2.4% in FY2019/20, inflation expected to decline in the coming months and the current account adjusting more rapidly than anticipated. However, domestic and international risks remain, and structural economic challenges persist. In this context, the authorities need to press ahead with their reform agenda,” Rigo said.