Status of Implementation of the IMF Program Chapter 7: Status of Implementation of The IMF Program The IMF Program which had been suspended in February 2022 became operative once again in June 2022. The seventh and eighth reviews were successfully completed and a loan amount of$1.2 billion was released by the IMF. The Program has been extended to June 2023, with three more reviews. The ninth review relates to the first quarter, July to September of 2022. The review was to be undertaken by the IMF staff from November 3 onwards. However, the review process has been delayed. The objective of this article is first to identify the macroeconomic trends in this quarter and up to November 2022 and analyze their consistency with the IMF macroeconomic projections. This is followed by an assessment of the status of implementation of actions and reforms committed to the IMF in the Letter of Intent on Memorandum of Economic Policies issued by the Government of Pakistan. This will help in understanding why the ninth review by the IMF has been delayed. 7.1 Macroeconomic Trends Table 7.1 highlights the trends in the first quarter of 2022-23 and compares them with the macroeconomic projections by the IMF. These projections do not reflect the large negative impact of the worst floods in Pakistan’s history estimated at over$30 billion. The IMF Staff report has targeted for a 3.5 percent GDP growth rate in 2022-23. After the floods, it is likely to fall sharply to minus 1 percent, as highlighted in Chapter 4.. The IMF projection of the rate of inflation in 2022-23 is also already off the mark. It is close to 20 percent, whereas the average monthly increase in the CPI has exceeded 25 percent in the first six months of 2022-23. This reflects the relative fast depreciation of the value of the rupee, supply shortages of food items which have emerged after the floods and the physical import restrictions. The IMF expects a monetary expansion of 12 percent in 2022-23. However, in the first quarter there has been hardly any increase in the money supply(M2). Private sector investment has faltered because of very high interest rates and consequently the quantum of credit has remained unchanged at the same level as in the first quarter of 2021-22. 83