Pakistan agrees to IMF conditions, to get $1.2 billion bailout funds: Pak FM Ishaq Dar

The Pakistan government has received a memorandum on the terms and conditions from the IMF for the completion of a USD 7 billion loan programme, Finance Minister Ishaq Dar said on Friday but acknowledged that both sides are yet to clinch a staff-level agreement on the much-needed bailout for the cash-strapped country. Dar made the statement after an IMF delegation, which left Pakistan on Thursday night after 10 days of talks with the government, said virtual discussions would continue on the ninth review of the programme.

The Memorandum of Economic and Financial Policies (MEFP) is a key document that describes all the conditions, steps, and policy measures on the basis of which the two sides declare the staff-level agreement.

Once the draft MEFP has been shared, the two sides discuss the policy measures outlined in the document. Once these are finalised, a staff-level agreement is signed, which is then forwarded to the International Monetary Fund’s (IMF) executive board for approval.

An IMF mission led by Nathan Porter visited Islamabad from January 31 to February 9 to hold discussions under the ninth review of the authorities’ programme supported by the IMF Extended Fund Facility (EFF) arrangement.

Pakistan, whose foreign exchange has dropped below USD 3 billion, is in desperate need of financial assistance and a bailout package from the IMF to prevent it from economic collapse.

The successful completion of the ninth review will bring the cash-strapped country USD 1.2 billion in the form of the next tranche.

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As the visiting delegation left without a concluding statement, there was some confusion about the outcome of the talks and whether a draft MEFP had been shared.

Dar, however, insisted in Friday's press conference that there was no confusion.

“We insisted that they (the Fund delegation) give us the MEFP before leaving so we could look at it over the weekend,” he said, adding that the government and the IMF officials would hold a virtual meeting in this regard on Monday.

“I am confirming that the MEFP draft has been received by us at 9 am today (Friday),” he added.