Pakistan among 76 countries to get debt relief from May 1

–FM Qureshi says developing countries would get relief on both the principal and interest amounts

–Relief would be given by all financial institutions, including IMF and World Bank

ISLAMABAD: Foreign Minister Shah Mahmood Qureshi on Thursday said that on Prime Minister Imran Khan’s appeal, the G20 countries have decided to provide debt relief to 76 developing countries, including Pakistan, and this decision will be effective from May 1.

Addressing a press conference in the federal capital, he said that this is a very timely decision and will give developing countries a fiscal space to make spending on their worst-hit segments of population amid the coronavirus pandemic.

He said that despite many cautious voices, the prime minister had launched an appeal to the world community on April 12, calling for debt restructuring for the developing world as the extraordinary spending by them had shrunk their fiscal space badly impacting the revenue generation and exports. He added that after scraping, Pakistan could only manage an economic stimulus package of $8 billion though it was unprecedented.

FM Qureshi said that the developing world faced difficulties of no fiscal space and a fragile health system. On one side, their revenue and exports are under bad impact, while on the other, there expenses are on increase as they need more hospitals, ventilators and other equipment, he added. However, he said, the prime minister told the world that the immediate response from the world could be a debt relief which would have its spin-off impact on the developed world too.

He said that following the PM Imran’s call, the United Nations (UN) and International Monetary Fund (IMF) chiefs endorsed the proposal and thus prompting the G20 countries to make a “historic decision”.

“Behind the prime minister’s appeal, there was a threadbare discussion at Foreign Office (FO), government’s economic team, with Pakistan’s permanent representatives at New York and Geneva, his letters and discussions with around 30 foreign ministers and heads of the international financial institutions,” he said.

The foreign minister told the media that this was the prime minister’s forth global initiative during his less than two years term including drive against climate change, campaign against eliminating Islamophobia, action against corrupt and illicit financial flows, and the latest being the initiative against debt relief.

Responding to a question, the foreign minister said that the developing countries would get relief on both the principal and interest amounts. He added that the relief would be given by all the financial institutions including IMF and World Bank (WB).

He hoped that the relief would have a substantial impact on Pakistan and the developing countries. Earlier, the relief was granted to the least developing countries, but after Pakistan’s initiative it was extended to 76 countries of the developing world, he added.

He said that the global pandemic required a global consensus. “Even Pakistan decided to take part in a video moot of South Asian Association for Regional Cooperation (SAARC) health ministers hosted by India despite the fact that the latter always undermined the regional forum.

Responding to another question, the foreign minister said that the federal government had convinced the provincial governments to reopen the airports in different cities to allow the return of stranded Pakistanis abroad. Pakistan also arranged chartered flights for the return of foreigners from Pakistan, he added.

Qureshi also urged United States President Donald Trump to review his decision of suspending the American funding to the World Health Organisation (WHO) as it was the time to cooperate.

He also assured that the impact of the debt relief would surely be passed on to the masses.

‘UNCONDITIONAL ECONOMIC SUPPORT’:

Separately, in a meeting with IMF Resident Representative Teresa Daban Sanchez, the foreign minister called for unconditional support for revival of economies of the developing countries to counter the coronavirus pandemic as its socioeconomic impact was far greater in the developing world.

FM Qureshi welcomed decision of the IMF, WB and G-20 countries to facilitate developing countries in payment of debts and economic assistance allowing for more fiscal space to tackle health and economic crisis of COVID-19.

Both sides discussed the present situation of COVID-19 and its negative impacts on the economy. The foreign minister said that despite having limited economic resources, Pakistan has taken effective steps to counter spread of coronavirus and its negative economic impacts. He said the pandemic has affected economies of the entire world but it has severe negative impacts on developing countries.

FM Qureshi said that PM Imran had called for debt relief for developing nations so that these countries could utilise their resources to counter the pandemic and to save the lives of people.

Both sides agreed to continue mutual consultation on COVID-19 situation and to counter this pandemic effectively.