Pakistan has formally requested “financial assistance” from the IMF, it was announced in a statement on Thursday, setting in motion a series of talks that could lead to a bailout of the country.
Christine Lagarde, the IMF chief, said she had met with Asad Umar, Pakistan’s finance minister, and Tariq Bajwa, the central bank governor, on the sidelines of the IMF and World Bank annual meetings in Bali, Indonesia.
“During the meeting, they requested financial assistance from the IMF to help address Pakistan’s economic challenges,” Lagarde said.
.@Lagarde: I met today with #Pakistan’s Finance Minister @Asad_Umar and his team, who requested our financial assistance to address Pakistan’s economic challenges. IMF team to visit Islamabad in the coming weeks to discuss a possible IMF-supported program https://t.co/YS7EsC2gcE pic.twitter.com/mlyRGAVFcP
— IMF (@IMFNews) October 11, 2018
She added that an IMF team will visit Islamabad “in the coming weeks” to initiate talks on an IMF program. “We look forward to our continuing partnership”, she said.
A new IMF bailout of Pakistan would be the latest in a string of interventions by the fund in the country.
It is by no means guaranteed, however, as Pakistan has been a heavy recipient of Chinese investment in recent years, triggering concerns about the transparency of the debt in the country and worries that the US may try to block an IMF program if it could indirectly help Beijing.
Pakistan has gone to the IMF several times since the late 1980s. The most recent was in 2013 when Islamabad got a $6.6 billion loan to tackle a similar crisis.
Umar announced earlier this week that the government would seek talks with the IMF on a “stabilization recovery program”.