IMF Recommends Pakistan to Spend 1% of GDP on Climate Adaptation

The International Monetary Fund (IMF) has advised Pakistan to allocate 1% of its GDP to protect against climate shocks such as extreme weather events. According to an IMF report, this investment in climate adaptation would help reduce the economic impact of natural disasters, returning Pakistan to pre-shock GDP levels faster. About 40% of this investment would be financed through concessional debt, with the rest funded by domestic debt. The IMF highlighted that this approach would strengthen Pakistan’s resilience to climate hazards.