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Jubilee Statements

Monitoring the impacts of government and corporate behaviour in communities overseas.

Pakistan asked to accept new loans in wake of floods

Release Date: 24-Sep-2010

As 20 million displaced persons piece their lives together, their government is putting aside almost one-third of its budget for foreign creditors. The funds will no doubt come at the expense of relief efforts for the victims of the August flooding. 

Despite this, there have been no moves by Pakistan’s creditors to forgo or postpone debt repayments. The Centre for the Abolition of Third World Debt (CADTM) reports that Pakistan has loans outstanding of $55 billion, and this is set to increase to $74 billion after a markup later this year. Pakistan paid $3 billion in debt obligations last financial year, one-third of government expenditure.

 

The repayments have been the object of strong criticism, with students and unionists taking to the streets of Lahore on Monday in protest. According to the CADTM, the protestors are demanding the government to ignore the debt and have made the case for outright cancellation, citing the failure of IMF and World Bank policies in the country. The calls for debt forgiveness are supported by academics and NGOs within the country urging that Pakistan prioritise its relief efforts for flood victims.

 

Meanwhile, the floods have forced millions into refugee camps and devastated the nations infrastructure, meaning that further resources must be spent bringing the relief where it is needed. As the government prepares its budget, Winter threatens further harm for a population already suffering an urgent humanitarian crisis.

The insistence of institutions like the International Monetary Fund and the World Bank to hold countries in the debt spiral, and the appalling human suffering that results from the international community’s failure to deal comprehensively with the debt crisis, is the reason the international Jubilee debt cancellation movement continues its work. 


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