Although the signing of the staff-level agreement (SLA) has been delayed because the International Monetary Fund (IMF) has insisted on receiving assurances regarding foreign financing, Pakistan has turned to the United States for assistance in obtaining "lenient treatment" from the IMF, The News reported.
In order to close the gap by the end of June 2023, the IMF has requested that Pakistan affirm that it needs $6 to $7 billion in external funding from Saudi Arabia, the United Arab Emirates (UAE), Qatar, and multilateral creditors.
Islamabad has little choice but to turn to Washington and its allies in the west for assistance if it wants to persuade the lender to give it "lenient treatment" for advancing towards the staff-level accord.
According to the report, Minister of Finance Ishaq Dar made contact with the American diplomatic mission in Islamabad and requested assistance from the US Treasury Department to break the impasse.
Despite the Pakistani authorities have carried out every possible move under IMF guidance, the IMF is now seeking 200% guarantees from friendly countries and multilateral creditors to close the financial shortfall on the external account of $6-7 billion through the end of June 2023.
According to one official with knowledge of the ongoing discussions with the IMF, the external financing gap has now shrunk from $7 to $6 billion as a result of the most recent discussions, but the IMF made it clear that Islamabad would need assurances from allies and multilateral creditors before signing the SLA.
The official continued, "The IMF believes that Pakistan has the initiative, but officials in Islamabad claim that when the IMF gives its approval, the external financing gap would be closed."
"How the IMF and Pakistani sides would move forward because each blamed the other for the long-awaited SLA's delay in being signed," he added.
In order to close the gap by the end of June 2023, the IMF has requested that Pakistan affirm that it needs $6 to $7 billion in external funding from Saudi Arabia, the United Arab Emirates (UAE), Qatar, and multilateral creditors.
Islamabad has little choice but to turn to Washington and its allies in the west for assistance if it wants to persuade the lender to give it "lenient treatment" for advancing towards the staff-level accord.
According to the report, Minister of Finance Ishaq Dar made contact with the American diplomatic mission in Islamabad and requested assistance from the US Treasury Department to break the impasse.
Despite the Pakistani authorities have carried out every possible move under IMF guidance, the IMF is now seeking 200% guarantees from friendly countries and multilateral creditors to close the financial shortfall on the external account of $6-7 billion through the end of June 2023.
According to one official with knowledge of the ongoing discussions with the IMF, the external financing gap has now shrunk from $7 to $6 billion as a result of the most recent discussions, but the IMF made it clear that Islamabad would need assurances from allies and multilateral creditors before signing the SLA.
The official continued, "The IMF believes that Pakistan has the initiative, but officials in Islamabad claim that when the IMF gives its approval, the external financing gap would be closed."
"How the IMF and Pakistani sides would move forward because each blamed the other for the long-awaited SLA's delay in being signed," he added.