In an interview with Voice of America, Nathan Porter, the IMF Mission Chief for Pakistan, stated that the new loan program from the IMF is significantly stricter, suggesting that if Pakistan successfully implements the necessary reforms, this could be the last loan program the country requires.
Porter highlighted the challenges faced during the previous program, noting high inflation and a substantial current account deficit, which were accompanied by minimal economic growth. He mentioned that while they were able to stabilize the situation with subsidies and concessions, these measures ultimately hindered growth prospects.
He emphasized the need for sustainable economic growth without relying on excessive incentives or concessions. At a recent event, Porter reiterated the IMF’s commitment to supporting both domestic and foreign investments, asserting that the government’s role should focus on providing essential infrastructure and developing a skilled labor force for businesses.
Reflecting on Pakistan’s economic progress, Porter acknowledged the significant stability achieved over the past year, despite the volatility and uncertainty experienced in mid-2023. “The change has occurred very quickly, and this provides a solid foundation for moving forward,” he remarked.
He further stressed the importance of maintaining a strong exchange rate, along with robust financial and monetary policies, to avoid the cycles of growth and decline that have historically plagued the country. Porter suggested that unlocking economic growth and development through the private sector, while easing economic restrictions, would be more advantageous for Pakistan’s long-term progress.
He hinted that if Pakistan continues on its path of economic stability and self-reliance, the current IMF program could indeed be its last.
