After Moody’s, another global rating agency, Fitch, also expressed concerns over Pakistan’s economy despite the International Monetary Fund (IMF) agreement.
According to the American media, rating agency Fitch has said that Pakistan will need financing in addition to IMF funding for debt repayment and economic recovery.
According to Fitch, if the current account deficit widens again, IMF funding will also prove insufficient.
Yesterday, Moody’s said that Pakistan’s entry into the new IMF program will be clear only after the elections.
It is uncertain whether Pakistan will receive the full $3 billion IMF fund in the 9-month program.
Rating agencies say that Pakistan has to pay off 25 billion dollars of debt in the current fiscal year, the amount of debt payments is 7 times more than Pakistan’s foreign exchange reserves.
According to Moody’s, Pakistan has increased taxes, cut spending for the IMF agreement, Pakistan has raised interest rates for the IMF agreement to the highest level in history.
It also says that financial aid to Pakistan from bilateral, multilateral partners may also be affected.
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