New IMF facility: more of the same

Following approval of the $7 billion Extended Fund Facility (EFF) by the International Monetary Fund (IMF), Pakistan has received the first tranche amounting to $1 billion. Immediately thereafter, the exchange value of the rupee registered an uptick, as the IMF loan will also make it easier to borrow both multilaterally and bilaterally. According to the fund, the new three-year credit programme will require "sound policies and reforms" to support Pakistan government's efforts "to strengthen macroeconomic stability, address deep structural challenges, and create conditions for a stronger, more inclusive, and resilient growth." At the same time, the IMF cautions, Pakistan's vulnerabilities and structural challenges remain formidable.