ISLAMABAD: Dr. Mahir Binici, Resident Representative of International Monetary Fund (IMF) in Pakistan, has highlighted that the ongoing conflict in the Middle East is anticipated to cause a significant economic slowdown and heightened risks across the Middle East, North Africa, Afghanistan, and Pakistan (MENAP) region. He urged Pakistan to continue implementing reforms to mitigate these effects.
According to International Monetary Fund, Dr. Binici addressed an outreach session at the Sustainable Development Policy Institute (SDPI), presenting the IMF’s April 2026 Regional Economic Outlook Update for the MENAP region. Dr. Binici noted that the war, which began on February 28, has disrupted energy markets, trade routes, and financial conditions, especially around the Strait of Hormuz. These disruptions have impacted global logistics and increased food and fertilizer prices, contributing to a sharp slowdown in regional growth.
Dr. Binici pointed out that for oil-importing countries like Pakistan, the conflict has exacerbated existing vulnerabilities through increased energy and food import costs, a potential decline in remittances from Gulf-based workers, and tighter financial conditions. He emphasized the importance of achieving macroeconomic stability, rebuilding fiscal and external buffers, and protecting vulnerable segments through targeted support measures rather than broad-based subsidies.
Dr. Binici acknowledged Pakistan’s performance under the IMF’s Extended Fund Facility (EFF) program as broadly on track. He mentioned a staff-level agreement on the third review under the EFF and the second review under the Resilience and Sustainability Facility (RSF) was reached in March. He outlined policy priorities for Pakistan, including maintaining a prudent fiscal stance, ensuring a tight, data-driven monetary policy, and advancing structural reforms.
In the medium term, Dr. Binici stressed the need to strengthen economic resilience through diversified trade routes, investment in critical infrastructure, enhanced regional cooperation, and reforms to promote private sector-led inclusive growth. He noted that continued implementation of reforms would be crucial for Pakistan to maintain stability amid an increasingly volatile regional and global environment.
Earlier, SDPI Executive Director Dr. Abid Qaiyum Suleri welcomed the IMF Country Resident Representative, stating that the discussion aimed to assess evolving regional and global dynamics and their implications for Pakistan’s economy. He added that the next tranche under the IMF program was pending a review by the Fund’s Executive Board. Dr. Suleri emphasized Pakistan’s vulnerability to regional and global shocks due to limited preparedness and advocated for targeted social protection policies and energy sector reforms, including negotiations on capacity payments and greater reliance on renewable sources.