ISLAMABAD: The top leadership is in a conundrum over whether to approachthe International Monetary Fund (IMF) for another bailout package as themacroeconomic situation worsens.
On Tuesday, an IMF technical assistance team concluded its week-long visitto Pakistan, which was also corroborated by its Resident Representative inIslamabad Daban Sanchez, reported *Express Tribune.*
The IMF technical assistance team comprised of Richard Llaudes, includingSanchez, Jongsoon Shin, Hua Chi, Tasneem Aslam and Maxym Kryshko, revealedsources.
As per sources, the main aim of the IMF technical team’s visit to Pakistanwas to assess the macroeconomic state of the country and came upon therequest of the Ministry of Finance.
On Friday, the National Security Committee (NSC) was provided apresentation regarding the worsening macroeconomic condition by the financeministry.
It was the 26th NSC meeting being held which was presided over by caretakerPrime Minister (retd) Nasir-ul-Mulk in which details of the Action Planwere deliberated upon.
The NSC acknowledged the endeavours of the finance minister and her team atthe FATF and it discussed the overall economic position of Pakistan.
An exhaustive presentation to the NSC meeting participants was provided byinterim finance minister Dr Shamshad Akhtar regarding the cogitationsduring meetings of FATF and International Co-operation Review Group held inParis.
According to sources, the NSC expressed dissatisfaction over the manner theeconomy was being managed by the government.
The NSC expressed worry over the high level of public debt, the influenceand logic of the recent rupee devaluation and high external financingrequirements for FY19, said sources.
Previously, the caretaker government had stopped the finance ministry fromreaching out to the IMF at any level.
However, sources said the finance ministry was in favour of formallyreaching out to the IMF due to deteriorating external sector position.
Nonetheless, Pakistan’s top leadership have certain hesitancy at thisjuncture and sources revealed their major worry is over the consequence ofthe next IMF programme on China-Pakistan Economic Corridor (CPEC).
The committee directed the finance ministry to apply its earlier decisionson the economy, said sources
The NSC was apprised the country’s public debt to GDP ratio would surpass72 percent or around Rs25 trillion for FY18.
Also, the sources disclosed there were worries over refinancing publicdebt, especially external public debt.
And the committee was provided details regarding the widening fiscal andcurrent account deficit, said sources. They shared the final figuresweren’t available, but it is expected current account deficit for FY18could be over $18 billion.
Also, sources revealed the country’s external financing requirement wouldrange from $25 to $27 billion for FY19 and they couldn’t be met alone withthe assistance of China.
However, sources in the finance ministry stated rising external financingrequirements would force Pakistan to get the World Bank, Asian DevelopmentBank’s and IMF’s assistance.
The sources in the finance ministry said the IMF team was provided withprovisional macroeconomic indicators but the delegation did not share itsmacroeconomic details with Pakistani authorities.