WASHINGTON: The deputy managing director of International Monetary Fund (IMF), Mitsuhiro Furusawa, said on Saturday that Pakistan’s economy was gradually gaining strength and its short-term vulnerabilities were also receding.

In a statement issued after the Fund’s executive board approved the next tranche of $502 million for Pakistan, Mr Furusawa urged Islamabad to continue implementing economic reforms to strengthen these gains.

“Building on these gains, further progress, including in the area of structural reforms, is needed to generate strong and inclusive growth and make the economy more resilient and competitive,” he said.

On Friday, the executive board announced the completion of the tenth review of Pakistan’s economic performance under a three-year programme supported by an Extended Fund Facility arrangement.

The board also approved Pakistan’s request for modification of the end-March 2016 performance criterion on the State Bank’s stock of net foreign currency swaps/forward position.

The decision enables the immediate disbursement of about $502.6m, bringing the total disbursements to Pakistan under this arrangement to $5.53 billion.

On Sept 4, 2013, the board had agreed to provide a 36-month extended facility of $6.64bn to Pakistan.

In a brief description of the Pakistani economy during the review period, Mr Furusawa welcomed Pakistan’s continued commitment to meeting the IMF programme’s fiscal targets.

But he also urged the country to further widen the tax net and ensure the fairness of the tax system. He also stressed the need for prudent management of budgetary spending and close coordination with the provinces.

He said that recent amendments to the Anti-Money Laundering Act constituted the first step towards widening the application of AML tools to the proceeds of tax crimes. Further efforts to strengthen the AML/CFT framework would help strengthen financial stability and tax compliance, he added.

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