IMF negotiations

WITH the country’s foreign exchange reserves depleting to dangerous levels, all eyes are on the government to see how its negotiations with the IMF pan out. Friday’s pages carried a concerning report on the State Bank’s forex holdings, which stood at just $6.1bn after the week that ended Dec 16. The central bank cited continuing repayments of external debt as the reason behind the sustained decline in its forex reserves. Those repayments are likely to get more and more difficult without new inflows, which is why satisfying the IMF and securing another tranche from the ongoing bailout programme has become so critical for maintaining the economy’s health. It is worth recalling that the ninth review of the IMF’s bailout programme had earlier been put off for two months due to the PML-N-led government’s unwillingness to accept certain conditions placed before it by the Fund, and the disagreements have yet to be resolved. Apparently, instead of acknowledging the ground realities and taking action accordingly, the people tasked with managing the country’s finances expended that time pleading with friendly countries to roll over maturing loans, make fresh deposits and provide some concessions, such as deferred oil payments.