Pakistan need another IMF program: According to former finance minister Miftah Ismail, Pakistan’s dwindling foreign exchange reserves may force the country to enter another International Monetary Fund (IMF) program once the present one expires in June.
“We won’t have much more than $10 billion in reserves if any when this [plan] concludes in June. That would be enough import coverage for around a month and a half. As a result, the nation would need to apply for loans from the World Bank and the Asian Development Bank, which would necessitate joining another IMF program.
“I am very sure we will need to have back-to-back IMF programs because of the debt payments we currently have to perform – roughly $20bn for the foreseeable future.”
Ismail compared receiving IMF aid to getting admitted to an intensive care unit and labeled the IMF as the lender of last resort (ICU). “You need to start leading a healthy life if you want to prevent having to use the ICU. We can prevent the need for IMF assistance if we start living within our budget. By implementing practical and wise economic policies, we can steer clear of turning to the IMF.
The former finance minister continued, “But if we continue living like we are, going from one boom-bust cycle to another, IMF is the lender of last resort and we have to keep going to it.