Pakistan's new government on Thursday agreed to a $5.3 billion loan from the International Monetary Fund (IMF), according to BBC News.
The loan will be released over three years, said the Associated Press, thereby allowing regulators to monitor the money's use. Pakistan's last IMF loan obligations were not honored, but the fund's Pakistan director, Jeffrey Franks, said they're willing to give the nation's newly-elected leaders another chance.
"It is true that some previous programs have not been completely successful," Franks told reporters alongside Pakistani Finance Minister Muhammad Ishaq Dar in Islamabad. "But the IMF is in the job of helping countries when they have difficult situations and need help, and we're not going to turn a country down because previous governments did not do what they had promised to do," he said, according to AP.
Debt-burdened Pakistan faces severe fiscal problems, but new Prime Minister Nawaz Sharif, elected in May, has promised to turn things around.
Dar, a lead negotiator on the deal, told reporters on Thursday that "[w]e have not carried the begging bowl in our hands, nor are we getting a grant," said the BBC. The new government will be required to rein in spending, increase taxes, and privatize largely state-held industries, according to the IMF's announcement on the deal.
“Pakistan faces a challenging economic outlook, compounded by an uncertain global and regional environment," the IMF statement said. "Macroeconomic imbalances have combined with longstanding structural problems, particularly in the energy sector, to sap the country’s growth potential."