PAKISTAN
By Najeeb Naich
The State Bank of Pakistan (SBP) has received the second tranche under the International Monetary Fund’s (IMF) Extended Fund Facility (EFF), providing much-needed support to the country’s external account amid economic reforms and fiscal adjustments.
According to an official statement, the SBP has received SDR 760 million (approximately US$ 1.023 billion) from the IMF on May 13, 2025, following the successful completion of the first review of the EFF program by the IMF Executive Board. The disbursement will be reflected in the SBP’s foreign exchange reserves for the week ending May 16, 2025.
The approval of the disbursement was made during the IMF Executive Board’s meeting held on May 9, 2025, as part of the ongoing $3 billion EFF agreement, initially signed in 2023 to stabilize Pakistan’s economy, address fiscal and current account imbalances, and rebuild foreign exchange reserves.
This inflow comes at a critical time, as Pakistan continues its efforts to implement structural reforms, improve tax collection, control inflation, and ensure fiscal discipline. The receipt of the tranche will not only bolster Pakistan’s foreign exchange reserves but is also expected to restore investor confidence and unlock additional multilateral and bilateral financing.
Economists believe the successful review signals the IMF’s continued confidence in Pakistan’s reform trajectory, though they caution that sustained fiscal consolidation and governance improvements remain essential for long-term macroeconomic stability.
