Pakistan, IMF resumes talks today

Islamabad, The Gulf Observer: Talks between the International Monetary Fund (IMF) and Pakistan resumed virtually on today, a Pakistani official said, as the two sides look to reach a deal to unlock funding critical to keep the cash-strapped country afloat.

The two could not reach a deal last week and a visiting IMF delegation departed from Islamabad after 10 days of talks, but said negotiations would continue. Pakistan is in dire need of funds as it battles a wrenching economic crisis.

“Duration (of the talks) cannot be confirmed but we intend to wrap these up at the soonest,” Finance Secretary Hamed Yaqoob Sheikh told Reuters in a text message, confirming that talks were resuming on Monday.

Talks centre around reaching an agreement on a reforms agenda under the country’s $6.5 billion bailout programme, which it entered in 2019. An agreement on the ninth review of the programme would release over $1.1 billion.

Pakistan’s international bonds slipped again on Monday after having suffered sharp falls on Friday following news that a deal with the fund had still to be reached.

The dollar-denominated 2025 bond saw the biggest declines, falling nearly 2 cents in the dollar before clawing back some losses to trade down 1.4 cents at 48.1 cents by 0900 GMT, Tradeweb data showed.

Pakistan’s foreign exchange reserves held by the central bank have fallen to $2.9 billion, barely enough to cover three weeks of imports. A resumption of the IMF programme would also unlock other avenues of funding for Pakistan.

An agreement, if reached, would still need to be cleared by the IMF board.