According to former finance minister Miftah Ismail, Pakistan will likely have to enter another International Monetary Fund (IMF) program after the current one ends in June due to a significant decline in foreign exchange reserves. He stated that at the end of the current program in June, the country will only have a meager $10 billion in reserves, which would only be enough to cover a month and a half of imports. In light of this situation, the country will be forced to seek loans from the World Bank and the Asian Development Bank, which will require it to enter another IMF program.
Ismail emphasized that due to the high amount of debt repayment that the country has to make, estimated at $20 billion in the near future, it will likely have to enter back-to-back IMF programs. He described the IMF as a lender of last resort, likening it to being admitted to the intensive care unit. The former finance minister stated that the country must start living within its means and adopting a sustainable economic policy in order to avoid relying on IMF programs.
He emphasized that if the country continues on its current path of alternating between boom-bust cycles, it will have to keep going to the IMF as a lender of last resort. To avoid this scenario, the country must start making responsible financial decisions and pursuing rational and intelligent economic policies. In conclusion, Ismail stated that the country must take steps towards financial stability and independence to break the cycle of relying on IMF programs.
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