Pakistan can overcome current obstacles and create a more prosperous future for all its citizens. Through proactive measures and a shared commitment to economic reform, Pakistan can navigate the path to long-term economic stability and resilience. The IMF’s role as a partner in supporting Pakistan’s economic objectives underscores the importance of international cooperation in addressing complex economic issues. Current engagement between Pakistan and the IMF presents an opportunity to address the pressing economic challenges facing the country and pave the way for sustained growth and prosperity.

As an International Monetary Fund (IMF) mission prepares to meet Pakistani authorities to discuss the next phase of engagement, the focus remains on laying the foundation for better governance and sustainable economic growth. The recent completion of a short term $3 billion programme helped Pakistan avert sovereign default, but the challenges ahead underscore the importance of a fresh, longer-term programme to foster inclusive growth for all Pakistanis. The IMF’s resident representative for Pakistan, Esther Perez Ruiz, highlighted the mission’s goal of fostering stronger, more inclusive, and resilient economic growth that benefits the entirety of Pakistan’s population. This emphasis on inclusivity and resilience is crucial as Pakistan navigates through economic challenges exacerbated by the ongoing global pandemic and external uncertainties.

Pakistan’s economy, valued at $350 billion, has shown signs of stability following the completion of the last IMF programme. Despite progress in stabilizing inflation and controlling the external account deficit, the country still grapples with a high fiscal shortfall and sluggish growth. Balancing the need for sustainable economic policies with the imperative of stimulating growth is a delicate task that requires careful planning and collaboration with international partners like the IMF. The upcoming discussions with the IMF are expected to focus on the FY25 budget, policies, and reforms under a potential new programme aimed at enhancing the welfare of all Pakistanis.

With a projected growth rate of around 2% this year, compared to negative growth last year, Pakistan aims to revitalize its economy through access to additional financing and technical assistance from international partners. The challenges ahead for Pakistan are numerous, as highlighted by the IMF’s assessment of exceptionally high downside risks. Political uncertainties, policy slippages, and global economic disruptions all pose significant threats to Pakistan’s economic stability and debt sustainability. The need for timely post programme external financing disbursements is underscored by the IMF, emphasizing the importance of proactive measures to address these risks.

IMF’s emphasis on the societal impact of economic policies is a reminder that sustainable growth must be inclusive to benefit all segments of the population. By prioritizing governance reforms, promoting resilience in the face of external shocks, and fostering a conducive environment for economic growth, Pakistan can build a foundation for long-term prosperity and stability. As Pakistan navigates these challenges and engages with the IMF to chart a path forward, collaboration, transparency, and a commitment to inclusive growth will be key.