A TECHNICAL team from the International Monetary Fund met Pakistan’s chief justice Yahya Afridi on Tuesday (11) to conduct a Governance and Corruption Diagnostic Assessment under the 2024 Extended Fund Facility programme.
The IMF team is in the country for a week-long trip to scrutinise the judicial and regulatory framework tackling governance and corruption as part of a £5.6 billion loan agreed last year.
Chief justice Afridi told reporters the six-member team sought details of the programme’s implementation and property rights.
“I told the IMF it has come to Pakistan at the best time,” he said, adding he asked the government and the opposition to set an agenda for judicial reforms. The IMF team was informed about reforms and the national judicial policy, the chief justice added.
Pakistan’s finance ministry said the IMF report will recommend actions for addressing corruption vulnerabilities and strengthening integrity and governance, noting that the findings would help shape structural reforms.
“The focus of the mission will be to examine the severity of corruption vulnerabilities across six core state functions. These include fiscal governance, central bank governance and operations, financial sector oversight, market regulation, rule of law, and AML-CFT,” the ministry said in the statement.
Pakistan’s government welcomed the IMF’s technical support, saying the assessment would aid efforts to promote transparency and institutional capacity. The country, currently bolstered by a £5.6bn facility from the International Monetary Fund (IMF) granted in September, is navigating an economic recovery.
The IMF is set to review Pakistan’s progress by March, with the government and central bank expressing confidence about meeting its targets.
Afridi said the IMF team also made suggestions in relation to the protection of property rights.
“I told the delegation we will make suggestions and create benches for early hearings in the high courts,” he said. According to Afridi, the IMF team expressed an interest in the protection of foreign investment in the country.
Pakistan agreed with the IMF in October to strengthen institutions, fight corruption, support inclusive growth, and ensure a level playing field for businesses and investments.
Meanwhile, Fitch Ratings said last Thursday (6) that Pakistan’s external financing needs will remain significant in the coming year, despite progress in rebuilding its foreign exchange reserves.
The country needs to repay over £17.6bn in external debt in the fiscal year 2025, including nearly £10.4bn in bilateral deposits, Fitch said.
“Securing sufficient external financing remains a challenge, considering large maturities and lenders’ existing exposures,” said the credit ratings agency.
Last month, the country agreed on a £803.3m loan with two Middle Eastern banks at a six-seven per cent interest rate, its finance minister told Reuters in an interview on the sidelines of the World Economic Forum .
Pakistan’s central bank chief earlier said the country aims to raise up to $4 billion from Middle Eastern commercial banks by the next fiscal year.
To address its external financing needs from the International Monetary Fund (IMF) and other multilateral and bilateral lenders, Fitch said Pakistan needs to continue implementing structural reforms, including those related to fiscal consolidation and improving its business environment.
Still, Fitch noted that Pakistan has made progress in rebuilding its foreign exchange reserves, outperforming targets set by the IMF.
Fitch also said Pakistan’s economic activity is now benefiting from stability and falling interest rates, expecting “real value added to expand by 3.0% in FY25”. (Agencies)
Lord Karan Bilimoria speaks during the event
