SBP Receives $700m from IMF

UAE has also confirmed the rollover of $2 billion in deposits

Muhammad Haris

The State Bank has received $700 million from the International Monetary Fund following Executive Board approval last week after the government successfully matched the laid down conditions.

UAE has confirmed the rollover of its two deposits of US$1.0 billion each placed with the State Bank of Pakistan for another year which were maturing in January 2024.

According to sources at SBP the IMF has released the $700 million tranche to Pakistan.

Pakistan after receiving this installment has so far received $1.9 billion from the IMF from the renewed package approved in July for $3 billion.

The Standby Agreement is to be completed by March 2024, if completed, the government will be entitled to get $1.1 billion as the last installment.

Already in the last two weeks arrival of inflows from International Financial institutions shored up the foreign exchange reserves.

The $700 million arrival increased foreign exchange reserves to around $8.7 billion.

The reserves would be around six months high, enough to cover two months of imports.IMF Review to Boost Pakistan’s Debt Rollovers and Stabilize Currency

The approval from IMF to help open gates from countries like China, Saudi Arabia, and UAE to roll over loans and deposits parked at SBP, giving much-needed support to domestic currency.

The domestic currency following the government’s decision to crack down against dollar hoarders, and smugglers, increased vigilance on traveling abroad, money changers, and smugglers of other goods helped recover against the dollar.

Rupee since its low of Rs 307.10 attained on Sept 5, 2023, recovered by 9 percent or Rs 26.60 at interbank while at the open market around Rs 52 at the open market from Rs 333 to Rs 281.

State Bank said that it had received SDR 528 million (equivalent to $705.6 million) in value on 16th January 2024 Funds received following successful completion of the first review by the Executive Board of IMF under Stand By Arrangement (SBA).

This disbursement will be reflected in SBP Reserves for the week ending on 19th January 2024.