ISLAMABAD: A three-member mission from the International Monetary Fund (IMF) is currently in Pakistan to undertake a comprehensive Governance and Corruption Diagnostic Assessment (GCDA) as part of ongoing efforts to assess and address vulnerabilities related to corruption within the country’s core state functions. The mission, which will remain in Pakistan until February 14, 2025, aims to analyze the severity of corruption risks in areas such as fiscal governance, central bank operations, market regulation, and the rule of law, according to the Finance Division’s announcement on Sunday.
The IMF’s focus on governance and corruption comes at a time when Pakistan is striving to implement broader structural reforms under the Extended Fund Facility (EFF) program, which is intended to stabilize and strengthen the country’s economy. In its October 2024 report, the IMF highlighted that the Pakistani government has agreed on a structural benchmark under the Memorandum of Economic and Fiscal Policies. The goal is to ensure that robust governance and anti-corruption institutions contribute to inclusive growth, equitable reforms, and the long-term sustainability of the country’s development efforts.
Corruption, coupled with bureaucratic inefficiencies and a challenging business climate, has long hindered Pakistan’s socio-economic progress. Vested interests have often played a major role in stalling or reversing much-needed reforms, thus maintaining barriers to economic growth. The IMF’s engagement with Pakistan through this diagnostic assessment is seen as a key step in addressing these challenges. The assessment will provide recommendations on strengthening governance, enhancing transparency, and reducing corruption risks that have undermined public trust in government institutions.
Pakistan’s authorities have actively sought capacity-building support from the IMF to conduct this diagnostic study. As part of their commitment, the government has pledged to publish the final GCDA report, including an actionable reform plan, by the end of July 2025. Additionally, the government has committed to issuing regulations by the end of September 2024 that formalize its intent to adhere to the United Nations Convention against Corruption. This further highlights Pakistan’s determination to demonstrate transparency and accountability in its fight against corruption.
A significant aspect of the reforms being examined is the enhancement of the National Accountability Bureau’s (NAB) independence and effectiveness. The government aims to address issues surrounding impunity for corruption and politically motivated persecution, which have plagued the organization’s ability to operate effectively. To this end, the government is awaiting a Supreme Court ruling on NAB’s organic law, which is expected to guide future improvements in its operations.
The IMF mission will also assess the implementation of asset declaration systems for high-level public officials. These systems, which are designed to deter illicit enrichment, will be digitalized and subjected to risk-based verification by Pakistan’s Establishment Division. This move aligns with Pakistan’s broader objectives of improving public sector accountability and transparency.
During their visit, the IMF team will engage with various Pakistani institutions, including the Finance Division, Federal Board of Revenue (FBR), State Bank of Pakistan, and Securities & Exchange Commission of Pakistan, among others. Their findings and recommendations will be crucial in helping the government tackle corruption vulnerabilities across key governance sectors. The GCDA report will play a vital role in shaping Pakistan’s future reforms, promoting institutional integrity, and supporting sustainable economic growth.
Historically, the IMF has been instrumental in advising member countries on improving economic governance and addressing corruption. The IMF’s role in fostering public sector transparency, accountability, and the rule of law has been pivotal in creating the necessary framework for long-term growth. The organization’s Governance and Corruption Diagnostic Assessment (GCDA) framework was adopted to promote effective engagement with countries to address governance vulnerabilities that impact macroeconomic performance.
This mission reflects Pakistan’s ongoing efforts to address systemic corruption challenges and improve its institutional capabilities. Through collaboration with the IMF, Pakistan hopes to strengthen its governance structures, enhance public sector efficiency, and create a more conducive environment for economic growth and foreign investment.