The International Monetary Fund has termed Pakistan's economic outlook as "favorable" with improved availability of energy, and growth-supporting structural reforms.

According to latest report released by IMF, confidence of investors in Pakistan is growing as its economy has stabilized after completing a bailout program.

It cited Chinese infrastructure investments as one of the reasons for economic development.

The report highlights that hopes are pinned on the China-Pakistan Economic Corridor initiative which will link the China's Xinjiang region with the Arabian Sea through Pakistan.

IMF report predicts six percent GDP over the medium term due to stepped-up China Pakistan Economic Corridor investments.

The report urges Islamabad to allow greater exchange rate flexibility as the country's foreign exchange reserves have declined in the context of a stable rupee-dollar exchange rate.

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