Islamabad: Moody’s Investors Service has termed the Pakistan and International Monetary Fund’s (IMF) USD 1.17 billion loan deal a ‘credit positive’ development for Pakistan’s economy, news sources reported on September 05.
The firm termed the deal a positive sign for the economic recovery from the deep recession and the overall balance of payment issues. A report published by the internationally recognized rating agency said that IMF financing and additional support from bilateral partners will ease pressure on Pakistan’s dwindling foreign exchange reserves. As stated in the report, the baseline expectation is that Pakistan would be able to satisfy its funding needs for the financial year (FY) 2023 and the next few years, assuming that Pakistan maintains engagement with the IMF for the remainder of the EFF programme and undertakes structural reforms to promote sustainable growth. The report also underlined the risks to the present economic recovery, such as increased import demand and flooding that has harmed agriculture and civic infrastructure. Moody’s stated that external pressure mixed with domestic policies will play a significant role in modifying the country’s macroeconomic policies.
It is worth noting that the IMF has released USD 1.17 billion under the EFF. This has also resulted in a USD 4 billion inflow from Gulf countries, which is expected to reduce the current account deficit (CAD).
Nauman Ahmad is an imaginative Pisces whose love for literature and nature is unparalleled. When he's not reading or hiking, he's sleeping and eating, which gives him plenty of energy for his next adventure.
