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WASHINGTON: Pakistan is poised to sign a preliminary deal on a review of its loan program with the International Monetary Fund this week, the country’s finance minister said, a key step required to pave the way for another $1.24 billion payout from the lender.

An IMF mission left Pakistan last week without signing a so-called staff level agreement (SLA) on the second review of the Washington-based lender’s $7 billion Extended Fund Facility and the first one on its $1.4 billion Resilience and Sustainability Facility agreed in 2024 to shore up the economy after a severe financial crisis.

“The mission was on the ground for a couple of weeks, we had very constructive dialogue with them around the quantitative benchmarks, the structural benchmarks and we’ve been having some follow-up discussions,” Muhammad Aurangzeb told Reuters during an interview on the sidelines of the IMF World Bank annual meeting.

“During the course of this week, we’re hoping that we can get the SLA done.”

Countries under IMF lending programs need to pass regular reviews, which — once signed off by the Fund’s executive board, trigger a payment of the next tranche of IMF funding.

The IMF program agreed in September 2024 helped shore up then-cash-strapped Pakistan’s $370 billion economy that was engulfed in an economic crisis with inflation spiraling to record highs, a rapidly depreciating currency and a bulging external deficit.

Aurangzeb expected the government would launch a green Panda bond — the first one denominated in Chinese yuan for Pakistan — before year-end and return to international markets next year with a bond sale of at least $1 billion, though details were still to be decided.

“Euro, dollar, Sukuk, Islam Sukuk — we’re keeping our options open,” he said.

Meanwhile, the privatization push — part of a long-delayed sale of state assets under an economic reform and fiscal stabilization agenda — was expected to gain traction in the fiscal year to end-June after disappointing results last year.

“This is something which is very important as part of our economic roadmap,” he said.

Pakistan was also making progress on the sale of three power distribution companies and national carrier Pakistan International Airlines (PIA).

“We are quite hopeful,” Aurangzeb said, citing prospects for qualified bidders for PIA after lucrative routes to Europe and Britain were opened, which made it “a very good proposition for the investors.”

The transaction would mark the country’s first major privatization in about two decades. A previous attempt collapsed last year after a single lowball offer was received, but the government has since drawn interest from five domestic business groups including Airblue, Lucky Cement, investment firm Arif Habib and military-backed Fauji Fertilizer.

Final bids are expected later this year.

KARACHI: Pakistan and Vietnam on Tuesday formally launched negotiations for a Preferential Trade Agreement (PTA) aimed at expanding trade, investment and connectivity between the two countries, the commerce ministry said following the Pakistan–Vietnam Business Forum in Islamabad.

The two Asian nations have maintained diplomatic ties since 1972, with relations strengthening in recent years through growing defense, trade and cultural cooperation. Bilateral trade currently stands at around $800 million, dominated by textiles, seafood, rubber, and chemicals. Officials on both sides have expressed the desire to double it in the coming years. 

Pakistan is currently pushing to grow trade diplomacy in Southeast Asia, as it seeks to diversify exports and deepen regional partnerships. 

Pakistani Minister for Commerce Jam Kamal Khan and Vietnam’s Minister of Industry and Trade H.E. Nguyen Hong Dien jointly addressed Tuesday’s business forum, which brought together dozens of business leaders, investors and government representatives from both nations. The ministers announced that negotiations on the PTA would begin immediately, with the goal of finalizing and signing the agreement by the end of 2025.

“The longstanding and friendly relations between Pakistan and Vietnam are growing stronger,” Jam Kamal Khan said while welcoming the Vietnamese delegation and business community. “There are vast opportunities for cooperation in textiles, leather, pharmaceuticals, agriculture, food processing, and information technology.”

Khan said the planned PTA would “enhance market access and trade diversification,” adding that both sides had agreed to strengthen collaboration in trade, investment, technology, connectivity and tourism.

“The Business Forum marks the beginning of a new chapter in Pakistan–Vietnam economic relations,” he said. “Meetings and B2B sessions will play a vital role in promoting bilateral trade.”

The commerce minister also invited Vietnamese firms to invest in Pakistan’s key growth sectors, noting that the country offered a young workforce and an attractive business environment. He said Pakistan sought to learn from Vietnam’s experience in industrial growth and value-added manufacturing, and expressed optimism that sustained cooperation would generate long-term partnerships between the two private sectors.

During the forum, the Trade Development Authority of Pakistan and Vietnam’s Ministry of Industry and Trade delivered presentations on investment potential and export opportunities. Both ministers urged the private sector to take an active role in joint ventures and cross-border projects.

Vietnam’s Minister of Industry and Trade said the PTA would pave the way for sustainable and mutually beneficial growth, creating new opportunities for businesses in both nations.

“The PTA will enhance market access and diversify trade,” he said, emphasizing that closer cooperation would help the two economies grow together.

The meeting also explored prospects for expanding religious and cultural tourism. The Vietnamese minister described Buddhist heritage sites as destinations for “spiritual journeys,” while the two sides agreed to promote collaboration in faith tourism.

Pakistan, home to the ancient Gandhara and Taxila civilizations, reaffirmed readiness to facilitate Vietnamese visitors seeking to explore Buddhist heritage sites. Khan also invited the Vietnamese business community to participate in the Food and Agriculture Expo to be held in Karachi in November.