New finance minister says Pakistan will seek a long-term IMF loan to stabilize the economy

ISLAMABAD (AP) — Pakistan plans to seek a long-term loan from the International Monetary Fund to help stabilize the country's ailing economy after the end of the IMF's current $3 billion bailout package, the country's newly appointed finance minister said Friday.

Muhammad Aurangzeb, who plans to meet with IMF officials in Washington in April, did not specify the amount that Pakistan would seek in comments to reporters in the capital, Islamabad. However, officials previously have said Pakistan wants to get up to $8 billion from the IMF over three years.

Cash-strapped Pakistan has been facing one of its worst economic crises since last year when weekly inflation at one point crossed 40% amid fears the impoverished Islamic nation could default on its payment of foreign debt.

In June 2023, the IMF approved the current, one-year $3 billion loan package to Pakistan after the country agreed to slash subsidies and raise taxes to comply with the bailout terms. Pakistan is to receive the final $1.1 billion tranche in April.

Aurangzeb said the inflation rate has since come down to 23%, and that he would seek to bring it down further, to provide some relief to residents who have struggled to pay electricity and gas bills.