The government of Pakistan is seeking an additional $2 billion from the International Monetary Fund (IMF) to address the impacts of climate change. Finance Minister Muhammad Aurangzeb is expected to make this request during the upcoming annual IMF meetings later this month.
This move follows Pakistan’s earlier request for climate financing, which was not immediately approved by the IMF. To improve its fiscal sustainability and revenue mobilization, Pakistan has already passed the FY24 budget, projecting a primary surplus of approximately 0.4 percent of GDP. The government is also committed to maintaining a market-determined exchange rate and reducing inflation.
Alongside the Finance Minister, officials from the Secretary of Finance and the State Bank will participate in the meetings, which are scheduled to conclude by October 26. Previously, on September 27, Pakistan requested an additional $1.5 billion loan from the IMF to combat climate change.
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During a meeting with IMF Managing Director Kristalina Georgieva, Prime Minister Shehbaz Sharif emphasized the urgent need for action against climate change in Pakistan. The proposed loan will support Pakistan’s Climate Resilience and Sustainability Facility, which aims to foster economic stability and sustainable development.
Additionally, it is noteworthy that the IMF Executive Board approved Pakistan’s 37-month Extended Fund Facility (EFF) arrangement of about $7 billion on September 25. This arrangement is intended to support the country’s economic stability and growth, focusing on sustainable public finances, reducing inflation, and strengthening external buffers.
