IMF targets do not represent ‘imposition of abrupt conditions’: Finance Ministry
ISLAMABAD: The finance ministry said on Sunday that the 11 targets, being categorised as “new conditions” under the ongoing programme with the International Monetary Fund (IMF), represented “continuity, sequencing, and deepening of Pakistan’s agreed reform agenda” rather than the “imposition of abrupt or unprecedented conditions”.
The ministry’s clarification follows reports of the government agreeing to 11 new targets, including additional tax measures and expenditure cuts from early next month, to make up for rising revenue shortfalls and to keep the $7 billion Extended Fund Facility (EFF) on track.
This was revealed in documents released by the IMF earlier this week, according to which commitment to the new or revised structural benchmarks, together with completion of two “prior actions”, enabled the conclusion of a staff-level agreement on the second review of the EFF and its approval by the IMF Executive Board for the disbursement of about $1.2bn for Pakistan on December 9.
A press release issued by the finance ministry today said that it had “clarified the intent, context, and continuity of reform measures under Pakistan’s IMF Extended Fund Facility programme, particularly in response to recent commentary regarding so-called “new conditions”.
“The purpose is to reaffirm that the measures referenced are part of a phased, medium-term reform agenda agreed with the IMF, many of which are extensions or logical progressions of reforms already initiated by the Government of Pakistan,” the press release read.
It said that the EFF was designed to support countries in implementing medium-term structural reforms aimed at achieving agreed policy objectives.
“These reforms are implemented in a sequenced and step-by-step manner over the duration of the programme,” it said. “Each review builds upon prior actions to ensure that the ultimate policy goals agreed at the outset of the program are achieved.
“Accordingly, actions under the EFF are structured as logical steps, with additional measures incorporated at each successive review.”
The press release said the Memorandum of Economic and Financial Policies (MEFP) with the IMF finalised after the second EFF review supplemented the MEFP agreed during the first review and reflected this phased approach.
During IMF discussions and negotiations, the government presented its planned policy reform initiatives, it said. “Where the IMF assesses that these initiatives contribute to the agreed programme objectives, they are incorporated into the MEFP.
“As a result, many of the structural benchmarks and actions included in the latest MEFP are derived from reforms already undertaken or initiated by the government of Pakistan, rather than being externally imposed or newly introduced conditions.”
The ministry issued clarifications for each of the 11 measures characterised as “new conditions”.
Regarding the public disclosure of asset declarations of civil servants, it said that this reform had been part of the EFF programme since the initial MEFP in May 2024. “The current structural benchmark represents the second step, following the successful legislative amendment to the Civil Servants Act, 1973,” it said. Staff Report
