WASHINGTON: The International Monetary Fund on Friday welcomed reform progress by Pakistan, saying policy efforts under the IMF-supported programme have helped stabilise the economy and rebuild market confidence.
IMF spokesperson and Director of Communications Julie Kozack said Pakistan is implementing an Extended Fund Facility (EFF) arrangement and an IMF staff team is expected to visit the country from February 25 for discussions on the third review under the EFF and the second review under the Resilience and Sustainability Facility (RSF).
She said Pakistan’s policy measures under the EFF have contributed to macroeconomic stabilisation and a gradual restoration of confidence. Fiscal performance has remained strong, with Pakistan posting a primary fiscal surplus of 1.3% of gross domestic product in fiscal year 2025, in line with programme targets.
Headline inflation has remained relatively contained, while the country recorded its first current account surplus in 14 years during fiscal year 2025, she added.
The Washington-based lender also noted that the Governance and Corruption Diagnostic Report has recently been published, outlining reform proposals including simplifying tax policy design, levelling the playing field in public procurement, and improving transparency in asset declarations.
In December last year, the IMF Executive Board approved a $1.2 billion loan for Pakistan after completing the second review of the country’s economic reform programme under the EFF.
Ahead of the upcoming mission, Pakistan has prepared a 15-point action plan in response to the Governance and Diagnostic Assessment Report, including identifying the top 10 high-risk federal agencies with corruption vulnerabilities and macro-critical exposures.
The plan proposes measures to reduce the backlog of economic disputes, including developing and publishing a methodology to assess court and judicial performance in the first year, followed by a performance report covering all administrative tribunals and special courts dealing with economic and commercial matters in the second year.
A 240-page action plan prepared by the government outlines steps to combat corruption and strengthen institutional governance. It proposes comprehensive performance assessment criteria and frameworks for evaluating court governance, including diversionary and Alternate Dispute Resolution mechanisms to improve case management.
A legislative review of the Anti-Money Laundering Act, 2010, will also be conducted to remove ambiguities. A Joint Working Group under the AML/CFT Authority will review the law to clarify whether a predicate offence conviction is required to prosecute money laundering, and to recommend amendments on definitional clarity, procedures and investigative powers. The proposed amendments are expected to be placed before parliament and notified by June 2027.
The National Accountability Bureau will draft a national corruption risk assessment and present it to the National Anti-Corruption Task Force, comprising multiple agencies, to develop a centralised framework for assessing corruption vulnerabilities across institutions.