WASHINGTON: The IMF on Friday praised Pakistan s economic performance and agreed on next steps, paving the way for release of another portion of a $6 billion, three-year loan package. Once the International Monetary Fund board gives the go ahead, the Washington-based lender will provide $450 million to help right the South Asian nation s economy, on top of the $1 billion released in July. “Despite a difficult environment, program implementation has been good, and all performance criteria for end-September were met with comfortable margins,” IMF mission chief Ernesto Ramirez Rigo said in a statement. The official, who led a team that spent two weeks in the country, pointed to signs of improving economic stability, including the move to a flexible exchange rate, and slowing inflation that is projected to fall under 12 percent next year. But he said more work was needed to target money laundering and on terror finance controls. Approval of the first performance review of Pakistan s policy program will also help unlock “significant funding from bilateral and multilateral partners.” Under the loan program, the government agreed to slash civil expenditure and freeze military spending while promising to substantially raise revenues to stem a yawning fiscal deficit, and pledging to collect 5.5 trillion rupees ($36 billion) in taxes. “The Pakistani authorities and IMF staff have reached a staff-level agreement on policies and reforms needed to complete the first review under the EFF. The agreement is subject to approval by IMF management and the Executive Board of Directors,” the IMF mission head said in a statement. The completion of review will enable disbursement of around $450 million to Pakistan. “Completion of the review will enable disbursement of SDR 328m (or around US$ 450m) and will help unlock significant funding from bilateral and multilateral partners,” the statement read. It said that Pakistan met all performance criteria for end-September with comfortable margins and the country is heading towards meeting all structural benchmarks. The government’s policies have started bearing fruit, helping reverse the buildup of vulnerabilities and restore economic stability, according to the IMF statement. The external and fiscal deficits are narrowing, inflation is expected to decline, and growth, although slow, remains positive. However, the global lender said that sustaining sound policies and advancing structural reforms remain key priorities to enhance resilience and pave the way for stronger and sustainable growth in the country.