UN memo says Pakistan should suspend debt repayments following devastating floods: Reports
Pakistan floods
Citing a UN policy memo, the Financial Times reported on Friday that Pakistan should suspend international debt repayments and restructure loans with creditors after recent floods added to the country's financial crisis. The UN Development Programme will share the memorandum with Pakistan's government this week. It further stated that the country's creditors should consider debt relief so that policymakers can prioritise financing its disaster response over loan repayment, the newspaper said.
Pakistan had earlier estimated the damage caused by the floods at $30 billion. 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, FT said.
Also Read |Pakistan's economy continues to struggle amid floods and falling currency
Earlier on Sunday,Pakistanfinance minister had said that the country will "absolutely not" default on debt obligations despite catastrophic floods.
Over 33 million Pakistanis have been affected by the floods and killed over 1,500 people. The financial damages have created concerns that Pakistan will not meet debts.
Both the government and UN Secretary-General Antonio Guterres have blamed the flooding on climate change. The stagnant floodwaters have given rise to a host of diseases, like malaria, diarrhoes, typhoid, dengue among other. At least 324 people have died due to the diseases.
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Hollywood actress and humanitarian Angelina Jolie had visited people displaced by the floods with international aid organisation IRC in an effort to raise awareness. She saw some of the worst affected areas in southern Sindh province.
"I've seen those lives who were saved," she said but added that without sufficient aid, others "won't be here in the next few weeks, they won't make it." Her comments, made when visiting the country's flood response center, were carried on video footage shared by the country's military on Wednesday.
(With inputs from agencies)
