KARACHI: Pakistan has successfully received over $1 billion from the International Monetary Fund (IMF) as the second tranche under the Extended Fund Facility (EFF), the State Bank of Pakistan (SBP) confirmed on Wednesday.
The disbursement follows the IMF Executive Board’s completion of the first review of Pakistan’s economic performance under the EFF, during its meeting held on May 9, 2025. As a result, the IMF approved an immediate release of SDR 760 million as EFF tranche. The Executive Board of the IMF had also approved a new $1.4 billion loan for Pakistan under its Climate Resilience Fund.
The SBP confirmed that it received the funds SDR 760 million equivalent to $1.023 billion on May 13, 2025. However, this inflow will be reflected in the state bank’s foreign exchange reserves for the week ending May 16, 2025. With release of this tranche, overall disbursement under EFF rose to $2.1 billion since the approval of the program.
The IMF will disburse a total of $7 billion to Pakistan under the 37-month Extended Fund Facility (EFF), approved in July last year. The program is designed to build economic resilience and foster sustainable growth by supporting structural reforms, strengthening macroeconomic stability, and boosting investor confidence amid ongoing fiscal challenges.
In its recent meeting, the IMF Executive Board acknowledged that Pakistan’s policy efforts under the EFF have already achieved significant progress in stabilising the economy and restoring confidence, despite a difficult global economic environment.
After a challenging period last year, Pakistan is now in a relatively comfortable position regarding its external debt obligations, as the majority of loans have been rolled over and foreign inflows have increased significantly.
SBP Governor Jameel Ahmed expressed confidence that the central bank’s foreign exchange reserves will reach the $14 billion mark by the end of June 2025. This projection is supported by robust inflows from home remittances and a surplus in the current account. As of May 2, 2025, Pakistan’s total liquid foreign exchange reserves stood at $15.483 billion, of which $10.33 billion were held by the SBP.
Copyright Business Recorder, 2025
