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Pakistan's external position under significant stress: Moody's

IMF to resume talks virtually next week

February 11, 2023 00:00:00

Revenue-raising measures will likely be among prior actions that the International Monetary Fund (IMF) requires before releasing the next tranche of financing to Pakistan, Moody's Investors Service said in a statement on Friday, reports Reuters.

Pakistan and the IMF will resume talks virtually next week after 10 days of face-to-face discussions in Islamabad on how to keep the country afloat ended without a deal.

The talks are aimed at unlocking at least $1.1 billion of stalled funding for the South Asian country.

"Pakistan's government liquidity and external vulnerability risks are elevated, and there remains considerable risks around Pakistan's ability to secure required financing to fully meet its needs for the next few years," Moody's said.

Pakistan and the International Monetary Fund said on Friday they were still discussing a deal to provide the South Asian nation with $1.1 billion in funds critical to keeping its economy afloat.

An IMF mission left Islamabad on Friday after 10 days of talks aimed at releasing the funds, part of a $6.5 billion bailout that Pakistan signed in 2019.

Finance Minister Ishaq Dar told reporters Pakistan had agreed with the IMF on the conditions to release the funds, which has been delayed since last December. Talks with the IMF would resume virtually on Monday, he said, adding that "routine procedures" were behind the delay.

"We will implement whatever has been agreed upon between our teams," Dar said. In a statement, Pakistan IMF Mission Chief Nathan Porter confirmed talks were continuing, adding that considerable progress had already been made.

Pakistan is in dire need of a successful outcome. The $350-billion economy is still reeling from devastating floods last year, and the government estimates rebuilding efforts will cost $16 billion.

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