The International Monetary Fund on Wednesday gave the go-ahead for a $3 billion loan to Pakistan after months of talks. The loan was actually announced at the end of June.
The International Monetary Fund said that this aid aims to support immediate efforts to stabilize the economy while making room for social and development spending to help the Pakistani people.
The country is suffering from the effects of the pandemic, political instability, and massive floods last year that submerged a third of the country. These factors mean that economic growth has slowed, inflation has risen and currency reserves have fallen, raising the risk that Pakistan will not be able to meet its international obligations.
Support from the International Monetary Fund extends over a period of nine months and is subject to a number of conditions. For example, the country had to promise to improve the tax collection system and tighten monetary policy.
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