Talks with IMF moving forward positively, says Finance Ministry

Govt says negotiations would continue until success of talks

ISLAMABAD: The ministry of finance on Sunday, rejecting the news regarding failure of talks between Pakistan and the International Monetary Fund (IMF), said there was not any deadlock with the IMF.

According to a statement, negotiations between Pakistan and the IMF are moving forward positively.

The statement, while mentioning that no timeline was set for at stage for conclusion of the talks, added that secretary Finance Division is leading the talks in Wasington D.C. while technical teams of both sides are continuing detailed discussions in virtual format after the exchange of relevant data sets.

Similarly, Finance Ministry Spokesman Muzammil Aslam also released a statement saying that there was no truth in news about the deadlock, adding that the talks would resume from Monday and would continue uninterrupted as per schedule.

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“Minister for Finance Shaukat Tarin and State Bank of Pakistan (SBP) Governor Reza Baqir were attending meetings in New York while the secretary Finance and his team were also engaged for talks in Washington DC as per schedule,” he said.

Aslam said that the date for ending talks was not fixed and the negotiation would continue till success of the talks.

Earlier, local media reports had claimed that Pakistan and the IMF had once again failed to reach a staff-level agreement at the scheduled time because of differences over the macroeconomic framework and deepening uncertainty over the future roadmap of the economy.

Reports said the two could not agree on the quantum of additional taxes and the roadmap for fiscal stability of the power sector.

It may be recalled that Finance Minister Shaukat Tarin had flown to Washington to meet with IMF managing director Kristalina Georgieva and US Assistant Secretary of State for South and Central Asia Donald Lu to conduct the talks.

Pakistan had shared some statistics with the IMF on power and gas tariffs and tax collection and “they are validating the numbers we shared with them and will get back to us”, Tarin had said while addressing a news conference in Washington at what had ben reported as ‘the conclusion of his visit’.

“This year, the Federal Board of Revenue (FBR) would achieve a tax collection target of Rs5.8 trillion,” Tarin had told the media, adding that in the next fiscal year, the tax-to-GDP ratio would be increased to 13.75 per cent of the GDP.

It may be mentioned here that Pakistan will have to complete 12 reviews for completing of 36 months Extended Fund arrangement, making it imperative for Islamabad to finalise the Memorandum of Economic and Financial Policies (MEFP) under intense scrutiny.

In July 2019, Pakistan and the IMF had signed a 39-month EFF for $6 billion but the programme remained largely off track, resulting in disbursements of only $2 billion in two years.

The successful conclusion of the talks would facilitate immediate disbursement of $1 billion by the IMF.

Tarin has expressed hope that top-level negotiations between Pakistan and the Fund would be successful and that the stalled loan programme would be put back on track.

“I believe that the progress we have made to date is really encouraging and as we say, God willing, I see this happening now in this visit,” he had said in an interview at the United States Institute of Peace on October 14.

Tarin said acknowledged that there were some problems in the power sector, including excess capacity, for which the government had to pay, adding that the performance of distribution and generation companies were also areas that needed further attention. However, he said all this was being successfully negotiated with the IMF.

 

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