SUMMARY of the Article “Negotiating effectively with IMF,” by Saeed Ahmed, Dawn, May 31st, 2024

The article delves into the complexities of Pakistan’s negotiations with the IMF for a new Extended Fund Facility (EFF) following the completion of the ninth-month Stand-By Arrangement (SBA). Given Pakistan’s ongoing fiscal and external vulnerabilities, another EFF appears necessary amidst rising political instability. IMF programs, characterized by ‘conditionality,’ require borrowing governments to undertake economic reforms. Effective IMF programs hinge on negotiations and a medium-term economic agenda owned by the borrowing country’s authorities, which should address root economic problems without alienating domestic interests. The professional and ideological alignments between IMF staff and borrowing government officials significantly impact negotiation outcomes, often resulting in larger programs with fewer conditions when ideological ties are strong. Pakistan’s past experiences, particularly during the 2019-2023 EFF program, » Read More…