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  • Writer's pictureDahlia Foundation

Pakistan’s election chaos casts shadow on next IMF deal

Islamabad, Pakistan — As Pakistan grapples with the aftermath of controversial elections, political chaos is threatening to cloud its $3bn deal with the International Monetary Fund (IMF), which analysts say is key to the country’s economic stability.

On Thursday, the global lender said Pakistan’s interim government had “maintained” economic stability. The IMF’s communications chief, Julie Kozack, said the interim government had managed to achieve fiscal targets while also “protecting” the social safety net.

“We look forward to working with the new government on policies to ensure macroeconomic stability and prosperity for all of Pakistan’s citizens,” Kozack said.

But the comments from the IMF come at a time when Pakistan is about to swear in a new government after this month’s general election, which has been marred by widespread allegations of rigging and manipulation.

Former Prime Minister Imran Khan, the founder of his Pakistan Tehreek-e-Insaf (PTI) party, drew a link between these allegations and the IMF loan in a statement from prison, asking the international body to carry out an audit of the elections before proceeding with the deal.

“Imran Khan will issue a letter to IMF. The charter of IMF, EU and other organisations stipulates that they can function or provide loan to a country only if there’s good governance,” Khan’s lawyer and Senator Ali Zafar told journalists after meeting the ex-premier at Rawalpindi’s Adiala Jail on Thursday. Khan is in jail over a series of convictions in cases involving a range of charges — from corruption to leaking secret documents.

Pakistan signed a nine-month standby agreement with the IMF last year. It will expire early next month, and securing another long-term plan is seen as a priority for the next government.

The February 8 elections in Pakistan saw a split mandate with PTI-backed candidates winning 93 seats in the National Assembly while the party’s main rivals, the Pakistan Muslim League-Nawaz (PMLN) and Pakistan Peoples Party (PPP), secured 75 and 54 seats, respectively.

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