Ishaq Dar at Geneva conference IMF Delegation Discussions

IMF Mission Discuss with Ishaq Dar:Ishaq Dar, the finance minister, will meet with a delegation from the International Monetary Fund (IMF) to “address unresolved problems” before the upcoming conference in Geneva conference, the lender’s spokesperson announced on Sunday.

On January 9, Geneva will host the International Conference on Climate Resilient Pakistan (Monday). The Pakistani government and the UN will share hosting duties for the event.

In order to assist the populace and the government following the devastation of the 2022 floods, it aspires to bring together government representatives, leaders from the public and business sectors, and members of civil society.

IMF managing director and Prime Minister Shehbaz Sharif had a “productive call” on January 6, according to a statement given to Dawn.com on Sunday.

The MD once more expressed her sorrow for those who were directly impacted by the flooding and backed Pakistan’s efforts to create a more robust recovery.

IMF Delegation

A delegation from the IMF is expected to meet with Dar outside of the Geneva summit. The purpose of the meeting is to discuss “outstanding concerns and the way forward”. The information was provided by an official.

A delegation from the IMF will visit Pakistan in “two to three days”. The purpose of the visit is to complete the ninth assessment of Pakistan’s Extended Fund Facility (EFF). The EFF is worth $7 billion.

In 2019, Pakistan signed up for a $7 billion IMF program, which was later increased to $6 billion. The ninth evaluation of the program, which would release $1.18 billion, is still pending. It was previously delayed for two months because the PML-N-led government refused to agree to some requirements put forth by the Fund, and the issues still haven’t been resolved.

According to a press release, Georgieva was invited to attend the conference by PM Shehbaz. The invitation was given after the premier’s phone call with the IMF managing director. The conference will be held in Geneva.

She thanked the prime minister for the invitation. She will only be able to participate remotely in the meeting. The IMF board meetings are scheduled for January 9 and 10.

The statement said that the prime minister congratulated the managing director. The prime minister assured the managing director that Pakistan was dedicated to successfully finishing the ongoing initiative. The prime minister also mentioned that the managing director understood the obstacles Pakistan has been facing.

Cash shortage

The State Bank of Pakistan’s (SBP) foreign exchange reserves have dropped to an eight-year low of $5.576 billion for the week ended on December 30, 2022, indicating that the nation is currently experiencing a serious cash shortage. This is equivalent to imports for three weeks.

Due to this decrease, the government was unable to repay its international debts without taking out new loans from allies.

Dar is also optimistic about reversing the situation. SBP reserves are rapidly declining. Projected financial assistance from friendly countries has not been realized yet.

Moreover for the discharge of external debt, the SBP’s foreign exchange reserves lost $245 million over the course of the week.

The most concerning issue for the coalition government led by the PMLN that faces a real default risk is how to service foreign debt. There have been numerous unsuccessful attempts to pick up the conversation with the IMF about releasing the following tranche.

The local currency has already been significantly undervalued in comparison to the US dollar and other major currencies due to the declining reserves. The SBP’s foreign exchange reserves decreased by $11 billion, from $16.6 billion in January 2022 to $5.6 billion now.