The International Monetary Fund (IMF) has approved a $500 million tranche to Pakistan after the lender's Executive Board completed a review of Islamabad's $6 billion loan program.
The IMF said in a statement that the latest payment for Pakistan's budget support brought total disbursements under the Extended Fund Facility to $2 billion since the program was first approved in July 2019.
"The Pakistani authorities have continued to make satisfactory progress under the fund-supported program, which has been an important policy anchor during an unprecedented period," IMF Deputy Managing Director Antoinette Sayeh said in a statement.
"While the COVID-19 pandemic continues to pose challenges, the authorities’ policies have been critical in supporting the economy and saving lives and livelihoods," she said.
The disbursement was made after Pakistan clarified an issue with data on government guarantees dating back to the 2016 fiscal year that had been reported inaccurately and put the government in noncompliance with the program.
The issue had arisen "as a result of a lack of interagency coordination in the compilation of government guarantees provided by the federal government to state-owned enterprises that contributed to incorrect estimates of government guarantees starting as far back as FY 2016," the IMF statement said.
The IMF said Pakistani authorities had taken corrective measures to address institutional shortcomings, including a lack of interagency coordination.
"In view of the strong and proactive commitment by Pakistan to provide timely and accurate data to the IMF in the future, the Executive Board decided not to require further remedial action," the statement said.
