ISLAMABAD: Finance Minister Miftah Ismail said on Friday that negotiations with the International Monetary Fund (IMF) are progressing well and that the country’s economic position would improve soon.
The finance minister turned to Twitter to reveal the current account deficit figures for April, which showed a 39 percent decrease from the previous month’s $1 billion to $623 million.
A Pakistani team is meeting with the World Bank in Qatar to discuss the delayed $6 billion credit deal. On May 24, Miftah will go to Doha to take part in the last round of talks.
“The April current account deficit was $623 million, less than half of the average for the first [nine] months of the fiscal year. This is a very encouraging indicator for external stability,” the minister added, as the rupee fell sharply in the currency market owing to fears over the country’s depleting foreign reserves.
The Current Account Deficit for April came in at $623 million, less than half the average for the first 9 months of the fiscal year. This is a very good sign for external stability. With positive IMF talks underway, we expect a turnaround in the economic situation very soon.
— Miftah Ismail (@MiftahIsmail) May 20, 2022
Miftah said that the administration expects a “turnaround” in the economy very soon, citing ongoing “promising” IMF negotiations.
The figures come as the coalition government seeks to expand the amount and length of the IMF loan program, as the central bank’s foreign currency reserves fell to $10.2 billion in the week ending May 13, enough to cover less than two months’ worth of imports.
The rupee is under pressure due to a growing current account imbalance and increasing imports. Energy subsidies are scheduled to be phased down, as well as unpaid subsidies in the oil and electricity sectors.
As the nation confronts an economic crisis, the government has put a ban on all luxury and non-essential goods imports in an attempt to stabilize foreign exchange reserves and relieve currency pressure.