IMF Next Review of Pakistan’s EFF, Climate Financing Expected in March
ISLAMABAD: The International Monetary Fund (IMF) is expected to conduct the next review of Pakistan’s Extended Fund Facility (EFF) in March, alongside discussions on climate financing support, officials and economic sources said.
The upcoming review is seen as crucial for Pakistan’s macroeconomic stability, reform momentum, and access to climate-resilience funding amid fiscal pressures and climate vulnerabilities.
What the IMF Review Will Cover
During the March review, IMF staff are expected to assess Pakistan’s progress on key benchmarks, including:
Fiscal consolidation and revenue targets
Energy sector reforms and circular debt management
Monetary policy stance and inflation control
Exchange rate flexibility and external financing
Structural reforms under the EFF framework
A successful review could pave the way for the release of the next tranche under the IMF programme.
Climate Financing on the Agenda
In addition to the EFF review, discussions are likely to include climate financing mechanisms, reflecting Pakistan’s exposure to climate shocks such as floods, heatwaves, and water stress.
Officials say Pakistan is seeking:
Concessional climate funding
Support for adaptation and resilience projects
Financing for energy transition and mitigation efforts
Alignment with IMF’s climate-related support instruments
Climate financing is increasingly tied to reform commitments and transparency measures.
Economic Outlook and Market Impact
Economists believe the March review will be closely watched by:
Financial markets
International lenders
Rating agencies
Foreign investors
A positive outcome could help stabilize the rupee, improve investor sentiment, and unlock additional multilateral and bilateral funding.
Government’s Reform Commitments
The government has reiterated its commitment to:
Maintaining fiscal discipline
Expanding the tax base
Reducing untargeted subsidies
Strengthening governance and transparency
Officials say meeting IMF conditions remains essential for sustained economic recovery.
Conclusion
The IMF’s March review of Pakistan’s EFF, along with discussions on climate financing, will be a defining moment for the country’s economic trajectory. A successful assessment could secure vital funding and support Pakistan’s climate resilience agenda.
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