ISLAMABAD: Pakistan must stop suspend international debt repayments and restructure loans with donors and creditors after recent catastrophic floods which have inflicted over $30 billion losses to Pakistan.
The United Nations Development Programme (UNDP) has mentioned in its memo which will be shared with Pakistan’s government this week.
According to the UNDP, Pakistan’s creditors should consider debt relief to support the policymakers to prioritise financing its disaster response over loan repayment, Mettis Global reported today.
Pakistan government has estimated the damage at $30 billion and the government and United Nations Secretary-General Antonio Guterres have held climate change responsible for the devastating flooding.
The memo further proposed debt restructuring or swaps, where creditors would let go of repayments in exchange for Pakistan agreeing to invest in climate change-resilient infrastructure.
So far, the ravaging floods have affected 33 million Pakistanis and killed over 1,500 people, leaving Pakistan in a very difficult situation.
In 2022-23, Pakistan needed $35 billion _ $21 billion for repayment of foreign loans and remaining for meeting the current account deficit.
