ISLAMABAD: In the wake of coronavirus pandemic and disbursement of $1.386 billion under the Rapid Financing Instrument (RFI) to help Pakistan address the economic impact of COVID-19 shock, Pakistan and the International Monetary Fund (IMF) have reportedly agreed to put on hold the existing $6bn Extended Fund Facility (EFF) programme, a local newspaper reported.
It has been learnt that further talks on $6bn Extended Fund Facility (EFF) programme would be held once the COVID-19 pandemic is over.
According to an IMF press statement issued on Friday, “A purchase under the Rapid Financing Instrument (RFI) equivalent to SDR 1,015.5 million ($ 1.386 billion, 50pc of quota) has been approved for Pakistan to meet the urgent balance of payment needs stemming from the outbreak of the COVID-19 pandemic.”
The IMF projected the near-term economic impact of COVID-19 to be significant, as it would give rise to large fiscal and external financing needs.
The IMF support would help provide a backstop against the decline in international reserves and provide financing to the budget for targeted and temporary spending increases aimed at containing the pandemic and mitigating its economic impact.