IMF delegation concludes Pakistan visit, notes progress in key areas

IMF delegation concludes Pakistan visit, notes progress in key areas
The seal of the International Monetary Fund (IMF) is seen outside of the headquarters building in Washington, DC on April 8, 2019. (AFP/File)
Updated 21 September 2019

IMF delegation concludes Pakistan visit, notes progress in key areas

IMF delegation concludes Pakistan visit, notes progress in key areas
  • The mission observed "significant improvement in tax revenue collections"
  • Says government's monetary policy is helping to control inflation

ISLAMABAD: 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 the IMF mission after concluding their visit to Pakistan on Friday.

A full IMF mission will return to Pakistan in late-October to conduct the first review under the $6 billion Extended Fund Facility (EFF), the mission added.

An IMF mission, led by Ernesto Ramirez Rigo, visited Islamabad and Karachi during September 16–20, 2019 to take stock of economic progress and discuss progress in the implementation of economic policies. 

“While the authorities’ economic reform program is still in its early stages, there has been progress in some key areas," a statement issued by the mission read.

The IMF delegation acknowledged that "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 (State Bank of Pakistan) has improved its foreign exchange buffers."

“There has been a significant improvement in tax revenue collections, with taxes showing double-digit growth net of exporters refunds," the statement read. 

The visiting delegation of the Fund also noted that "FBR is undertaking significant steps to improve tax administration and its interface with taxpayers" and said that "Importantly, the social spending measures in the program have been implemented."

“The near-term macroeconomic outlook is broadly unchanged from the time of the program approval, with growth projected at 2.4 percent 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," the IMF delegation noted.