REPAYMENT of the $58-billion international debts of Pakistan
should be frozen to give the country a chance to reach its poverty
goals, and to develop democracy, a new report suggests.
The report, Unlocking the Chains of Debt, produced
jointly by the Jubilee Debt Campaign and Islamic Relief, criticises
the International Monetary Fund for imposing crippling conditions,
and questions the legitimacy of some of the debts. The repayment
freeze would allow an audit of all the country's debts, to
establish which should be paid and which should be cancelled.
"The repayment burden is undermining the fight against poverty,"
the report says, "and is also a serious threat to the country's
The country's foreign-debt burden has doubled since 2006, and
annual repayments will soon reach $6 billion - equal to a fifth of
all its exports, or more than half of the country's health and
The director of Jubilee Debt Campaign, Nick Dearden, said: "The
majority of debts that Pakistan supposedly owes to the world have
done nothing to help the majority of the country's people, from
funding useless and damaging irrigation projects to propping up
dictators and using natural disasters to push more loans on the
"Pakistan has had enough of this kind of 'help' from Western
institutions like the IMF, which has pushed ever more unpayable
loans, attached to damaging and undemocratic policies. Pakistan
would be better advised to mobilise its own resources to build a
more equal, balanced, and stable country."
The report also calls for progressive taxation reforms, to
ensure that the wealthy in Pakistan contribute more to providing
the government with the revenue it needs to tackle poverty and
The country director for Islamic Relief in Pakistan, Dr Fayaz
Ahmad, said: "More than 50 million people in Pakistan live below
the poverty line. Efforts to tackle poverty and meet the Millennium
Development Goals are in tatters as the economy struggles to deal
with the costs of devastating seasonal floods, the 'war on terror',
and the huge burden of foreign debt.
"The legitimacy of the debt needs to be challenged if widespread
economical turmoil and instability are to be avoided."