IMF team meets with Finance Minister Paudel

KATHMANDU: An International Monetary Fund (IMF) staff team led by Sarwat Jahan, has paid a courtesy call on Deputy Prime Minister and Finance Minister, Bishnu Prasad Paudel.

The team is here to review the Extended Credit Facility (ECF) provided by the IMF to Nepal.

During the meeting held at the Finance Ministry, Singha Durbar, today, Minister Paudel said signs of improvement are seen in country’s economy in recent period, expressing the belief that the future activities of the improvement would bring further positive results.

The government was ready to address the economic challenges through legal, policy-level as well as dialogue and it has been paying special attention for the improvement, he mentioned.

DPM Paudel expressed commitment to implement the suggestions received from international community based on country’s national context and needs.

Saying the fifth review programme of the IMF was important for the country, the Finance Minister urged the team to hold further discussions on the issues raised about improvement of economy.

The government has focused its attention on policy and structural reforms to resolve economic problems, he clarified.

According to the Finance Minister’s private secretariat, he expressed the view that policy reforms would play an important role in strengthening the economy in the long run. Lauding the suggestions and support received from international development partners in the reform programme, he said it would be implemented as per the country’s needs.

The IMF team said it was reviewing the impact of past reform programmes and was carrying out homework for future reforms.

The team has come here to review the progress made through the past reform initiatives in connection with making the country’s economic development policies and strategic plans timely.

In January 2022, an ECF of USD 371.6 million was taken due to the decline in foreign exchange reserves and weakening balance of payments.

At that time, the ECF was taken to reach 180 per cent of the special drawing rights quota received through the IMF. In previous reviews, the IMF had cited political instability, low implementation of capital expenditure and banking risks as the main challenges.

It also suggested strengthening the financial system and being serious about preventing money laundering. It was emphasized that fiscal discipline is essential by increasing capital expenditure for the long-term stability of the economy.