Advocates are calling upon world financial institutions to cancel Pakistan’s debt in the wake of record flooding this summer.
Washington-based Jubilee USA is spearheading the effort on behalf of the South Asian nation, which continues to recover from summer flooding that inundated a large swath of the Indus River valley, leaving nearly 2,000 people dead and 10 million homeless. Overall, 20.3 million have been affected.
Melinda St. Louis, deputy director at Jubilee USA, said the coalition has called upon the international community to freeze Pakistan’s debt payments for two years as a first step toward cancellation.
She also said it’s important for institutions such as the International Monetary Fund and the World Bank to cease making new loans to Pakistan and provide grants and gifts instead because the country is in no position to handle additional debt.
“We began this call because our partners in Pakistan were asking for that,” St. Louis told Catholic News Service. “They have been saying that Pakistan pays more than $3 billion per year in debt service to foreign creditors. In addition the (worldwide) response to the disaster has been much less than needed.”
The concern, she explained, is that Pakistan is not considered poor enough under current rules to qualify for debt forgiveness. Jubilee USA and its partners are seeking to have the rules updated for emergency situations like Pakistan’s.
Jubilee USA plans to gather Oct. 8 in Washington at the start of the annual meetings of the International Monetary Fund and World Bank. The organization plans to display a paper chain link with individual links sent by people from around the U.S. seeking the debt cancellation.
The message: Break the chains of debt.
Next steps will be determined after the financial meetings conclude Oct. 10.
Filed under: CNS