(MENAFN) The IMF announced on Wednesday that it has secured a staff-level agreement with Pakistan under the Extended Fund Facility (EFF) and the Resilience and Sustainability Facility (RSF).

This arrangement paves the way for a potential release of roughly $1.2 billion, contingent on the approval of the IMF Executive Board.

If sanctioned, Pakistan is set to receive $1 billion through the EFF and an extra $200 million via the RSF, bringing the combined disbursements under both programs to nearly $3.3 billion.

This update followed a two-week mission by the IMF team, which visited Karachi and Islamabad from September 24 to October 8.

In its official statement, the IMF highlighted that Pakistan’s economic recovery remains progressing well, marked by its first current account surplus in 14 years, stronger fiscal management, and inflation remaining within target levels.

However, the IMF cautioned that the recent floods, which have impacted almost 7 million individuals, have hindered economic growth.

"The recent floods, which have affected nearly 7 million people, caused over 1,000 deaths, and severely damaged housing, public infrastructure, and agricultural land, have weighed on the outlook, particularly of the agriculture sector," the statement said.

The international lender added that Pakistani officials have reiterated their dedication to the programs supported by the EFF and RSF, committing to sound and cautious macroeconomic policies while continuing with structural reforms.

Last year, the IMF and Pakistan had reached a staff-level agreement on the final assessment of a $3 billion bailout package.

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