The International Monetary Fund (IMF) concluded its recent staff visit to Islamabad, Pakistan, led by Nathan Porter. The visit, which commenced on May 19, 2025, focused on the country's economic developments and program implementation.
In a statement following the conclusion of the visit, Mr. Porter noted that "we held constructive discussions with the authorities on their FY2026 budget proposals and broader economic policy and reform agenda supported by the 2024 Extended Fund Facility (EFF) and the 2025 Resilience and Sustainability Facility (RSF)." He emphasized that Pakistani authorities are committed to fiscal consolidation while protecting social expenditures. Their goal is to achieve a primary surplus of 1.6 percent of GDP in FY2026.
The discussions during this visit also centered around measures to increase revenue through improved compliance and an expanded tax base while prioritizing expenditures. "We will continue discussions towards agreeing over the authorities’ FY26 budget over the coming days," Mr. Porter added.
Reforms in Pakistan's energy sector were also addressed as part of ongoing efforts to improve financial viability and reduce costs within the power sector. These structural reforms aim to foster sustainable growth and create equitable conditions for business and investment.
Pakistani authorities highlighted their dedication to sound macroeconomic policymaking. They plan to maintain a tight monetary policy that is data-dependent to keep inflation within a target range of 5–7 percent set by the central bank. Additionally, rebuilding foreign exchange reserves, maintaining a functional FX market, and allowing more exchange rate flexibility are crucial steps toward strengthening resilience against external shocks.
Mr. Porter expressed gratitude towards Pakistani federal and provincial authorities for their hospitality during this period of collaboration: "The mission thanks the federal and provincial authorities for their hospitality, constructive discussions, strong collaboration, and commitment to sound policies." The IMF team intends to stay engaged with ongoing dialogue ahead of further reviews under EFF and RSF planned for later in 2025.