ISLAMABAD (MNN); The International Monetary Fund (IMF) on Thursday said Pakistan’s reform performance has remained robust despite challenging economic conditions and the impact of recent floods. The country posted a 1.3% primary surplus in FY25, while foreign exchange reserves rose to $14.5 billion.
The announcement came after the IMF completed Pakistan’s second review under the Extended Fund Facility (EFF) and approved the first review under the Resilience and Sustainability Facility (RSF).
This triggered an immediate disbursement of $1 billion under the EFF and $200 million under the RSF, bringing total payouts under both programs to $3.3 billion.
The IMF described the recent inflationary surge as temporary, mainly caused by flood-related disruptions, and emphasized that consistent and credible macroeconomic policies were essential to maintain stability.
The Fund highlighted the need to expand the tax base, simplify the tax system, and improve data quality, statistics, and governance to strengthen long-term economic resilience.
It also stressed structural reforms in public accounts, state-owned enterprises, and the energy sector. Timely power tariff adjustments were recommended to reduce circular debt, while better energy-sector performance was deemed critical for competitiveness.
The IMF advised the State Bank of Pakistan to increase transparency and flexibility in the foreign exchange market.
Furthermore, the Fund noted that the recent floods highlighted the urgency for climate-focused reforms, including improved water management and enhanced disaster preparedness, while private-sector-led growth would be key to driving economic recovery.
