The Financial Times on Friday cited a United Nations policy memorandum that said Pakistan should suspend international debt repayments and restructure debt with creditors in the wake of the country’s financial crisis following the recent floods.
The newspaper said the United Nations Development Program will share with Pakistan’s government this week a statement that the country’s creditors should consider debt relief so that policymakers can prioritize funding their disaster response over debt repayment.
Pakistan has previously estimated damages at $30 billion, and both the government and UN Secretary-General Antonio Guterres have blamed the floods on climate change.
The FT said the memo proposed debt restructuring or swaps, where creditors would forgo repayments in exchange for Pakistan agreeing to invest in climate change-resilient infrastructure.
The floods have affected 33 million Pakistanis, caused billions of dollars in damage, and killed more than 1,500 – raising concerns that Pakistan will not repay the debt.
(Except for the title, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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