Pakistan and the International Monetary Fundare due to wrap up talks Tuesday over the release of the final tranche of a 596 million dollar standby facility, officials said.
They said the IMF, which is due to release the final instalment of 130 million dollars next month, had indicated that a much larger poverty reduction and growth facility (PRGF) was being positively considered.
"We are satisfied with our talks with the visiting IMF team," a senior finance ministry official told AFP.
"The Fund has not only expressed its satisfaction at the progress of its current loans but indicated the granting of the PRGF also."
The five-member IMF mission has spent the past week in Islamabad reviewing Pakistan's progress in key structural reforms ahead of the release of the last instalment in the 10-month arrangement signed in November.
IMF team leader Abbas Mirakhor and Finance Minister Shaukat Aziz met President Pervez Musharraf here Tuesday to discuss the review process, officials said.
"General Musharraf thanked Mirakhor for his continued support and assistance to the government," the state-run APP news agency reported.
"Mirakhor expressed his appreciation of the government's economic reforms, which had resulted in improvement of the country's macro-economic situation and increased international credibility."
Sucessful implementation of the standby arrangement, including reforms to boost Pakistan's tax base and stabilise the rupee among others, is key to Fund support for the proposed PRGF.
"Another IMF team is expected to visit Islamabad in October before signing a memorandum of understanding for the PRGF," said the finance ministry official, who did not want to be named.
A Pakistani delegation may head to Washington before the October visit by the team, he said.
Along with defence spending, the cost of servicing Pakistan's massive foreign debts are strangling the meagre resources available for development and poverty-reduction programmes.
Pakistan's economy has been under severe strain since Islamabad carried out nuclear tests in May 1998 in response to similar detonations by arch rival India.
The tests led to sanctions which pushed the country to stray from reforms set with international credit agencies, leading to the suspension of IMF programmes in 1999. |
