Pakistan to decide on IMF bailout by September

August 9, 2018 - 12:54

The biggest challenge for the new government in Islamabad, experts say, will be economy. Imran Khan-led government will inherit a flailing economy that needs to be revived, and speculation is rife that Pakistan will approach International Monetary Fund (IMF) for the bailout.

It is, however, still not clear when the new government in Islamabad approaches the IMF. Asad Umar, the likely new finance minister, told media persons on Tuesday that Pakistan will decide by the end of September whether or not to go to IMF.

“By the end of September, we should make our decision,” said Umar, a close aide of Khan, hinting that Pakistan was exploring other options as well, including loans from friendly countries like China.
His remarks came a week after the U.S. Secretary of State Mike Pompeo voiced concerns over any IMF bailout being used to repay Chinese loans to Islamabad. “There’s no rationale for IMF tax dollars — and associated with that, American dollars that are part of the IMF funding — for those to go to bail out Chinese bondholders or China itself,” Pompeo told CNBC.

Pakistan has gone to the IMF many times since 1980s. The last time was in 2013, when Islamabad got a $6.6 billion loan to tackle a similar crisis. According to analysts, Pakistan needs a loan of around $12 billion to revive the flailing economy.

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