Dubai: Pakistan Prime Minister Imran Khan has appealed to the world financial bodies to introduce ‘global intiative for debt relief’ for the developing countries like Pakistan facing worsening financial meltdown due to the COVID-19 pandemic.
In his address to the nation on Sunday night, Prime Minister Imran appealed to the world leaders, leading financial institutions and the United Nations Secretary General (UNSG) for launching of ‘global initiative on debt relief’ to provide much needed relief to the developing countries.
“My appeal to the international community, the UNSG & international financial institutions to respond positively to the dilemma confronting developing countries in the face of the COVID19 pandemic,” Imran also tweeted after his speech.
Pakistan, which has already experienced low growth rates in recent years, could well fall into a recession with 1.8% population growth, that would imply a painful decline in per capita income,” according to a report released by the World Bank.
93 deaths
Imran’s appeal came after the confirmed coronavirus cases in Pakistan have risen to 5374 while 93 patients have died and 10956 have recovered, according to the official figures on Mondday. Punjab remains the worst-hit province with 2594 cases followed by Sindh 1411, Khyber Pakhtunkhwa 744, Balochistan 230, Gilgit Baltistan 224, Islamabad 131 and Pakistan Administered Kashmir with 40 cases.
In his televised speech, Prime Minister Imran juxtaposed the financial health of the developing countries especially Pakistan where the government had been striving simultaneously to avoid spread of the deadly COVID-19 through clamping of lockdowns and saving the people from death due to hunger.
US$8 billion stimulus package
Imran cautioned that the pandemic’s socio-economic impacts would be more consequential in the developing countries. While proposing the initiative, he highlighted that his government had provided a US$8 billion stimulus package to help the most vulnerable Pakistanis in a country having a total population of 220 million people, reported APP.
The proposed global initiative aimed to lay ground for urgent debt relief to the developing countries, at their request, and without onerous conditionalities. The initiative was built on the prime minister’s belief that enhanced fiscal capacity was fundamental to recovery from the ongoing pandemic crises.
Noting the UN Secretary General’s call for action, Prime Minister Imran also urged the world leaders to step up measures to help developing countries to overcome disastrous impacts of COVID-19.
Fiscal space
He proposed that the developing countries should be provided with fiscal space and financial relief through enhanced debt relief and restructuring and other additional measures that could help them manage the unfolding crisis.
The prime minister observed that in the context of unprecedented challenge from the COVID-19, the global response had two different aspects emerging in the developing world and the developed countries.
He noted that the developing countries like Pakistan had the dilemma of containing the novel coronavirus and as well as dealing with the impacts of economic crises leading to hunger and poverty.
He cautioned that the greatest worry in the developing countries was now of people dying from hunger as a result of the lockdowns.
Discrpancies
The prime minister also noted the ‘huge discrepancies in the financial resources’ available with the two groups of countries.
My appeal to the international community, the UNSG & international financial institutions to respond positively to the dilemma confronting developing countries in the face of the COVID19 pandemic.
He said his government had announced a maximum relief package which it could afford to combat coronavirus challenge. Most of the developing countries had high debts of GDP ratio and they did not have money to spend on overstretched health services and to save people from dying.
Relief packages
In this regard, the prime minister mentioned the response of the developed countries ie; the US government’s announcement of a stimulus relief package of 2.2 trillion dollars, Germany 1 trillion Euros and Japan 1 trillion dollars to face the coronavirus challenge.
He said the COVID-19 pandemic posed unprecedented health and economic challenges.
He also underlined that a global recession was certain, one worse than the Great Depression. “A global pandemic cannot be contained without strong, coordinated and well-crafted global response,” he stressed.
The global initiative on debt relief would bring together stakeholders on a platform to promote coordinated health and economic response.
The prime minister also invited the UN Secretary General to work with him in advancing the objectives of a coordinated response.
Diplomatic outreach
According to a press release of the PM Office media wing issued on the occasion, as part of his diplomatic outreach, Prime Minister Imran Khan would be approaching Heads of States and governments from a wide range of countries notably from Paris Club, Highly Indebted Poor Countries (HIPC), heads of International Organizations and others concerned to join him in this endeavour.
He has entrusted the foreign minister and the adviser on finance to reach out to their respective counterparts to work for the “Global Initiative on Debt Relief” with the objectives of relieving developing countries of the financial challenge from the COVID-19 pandemic and realising sustainable development.
Relief funding
During the past week, various announcements had been made by multilateral actors such as the UN, the IMF, and the World Bank. The announcements included initial relief packages of US $1.4 billion by the IMF, and US $1 billion by the World Bank.
Earlier this month, Pakistan and WB signed a $200 million ‘Pandemic Response Effective Project’ (PREP) that would help the poor and vulnerable cope with the immediate impact of the Covid-19 pandemic through social protection measures, food rations and remote learning education.
The bank’s support would also draw on extra $38m from eight existing projects for urgently needed medical equipment and supplies. The Asian Development Bank also pledged $350m to Pakistan last month to support its Covid-19 emergency response.
