Debt Rescheduling from China?
Will China reschedule Pakistan’s USD 27 billion debt?
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Pakistan suffered a loss of USD 40 billion in the wake of recent flash floods. This figure merely covers the material damages caused to infrastructure however, intangible losses go unaccounted for.
Either way, money remains of paramount importance in Pakistan's flood relief efforts. Currently, Pakistan’s external debt forms around 25% of the GDP (as per the latest data). This deepens the current account deficit, a problem plaguing Pakistan’s economy since time immemorial.
In such a complex situation, debt relief may offer a quick solution to our plight. But is it enough?
So far Pakistan has received debt relief from the Paris club and the US. Moreover, relief is expected from China in return for promises of CPEC being revived. Huge monetary relief is expected from the world, however, the gap between Pakistan’s damages and its requirements is increasing with every passing day.
GRAPHICS OF THE DAY
Pakistan's External Public Debt and Liabilities, Outstanding (total till June 2022)
Pakistan's External Public Debt and Liabilities Outstanding, Long Term > 1 year (till June 2022)
INSTAGRAM POSTS
Consumer Confidence Index September 2022 — www.instagram.com
⚫ Overall Inflation Expectations decreased by 1.2% in September 2022 as compared to July 2022
⚫ Consumer Confidence Index (CCI) increased by 9.2% in September 2022 compared to July 2022
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SBP's forex reserves were recorded at USD 7.597 billion, compared to USD 7.596 billion on October 7, 2022 — www.instagram.com
⚫ The minor change means that reserves continue to remain at their lowest level since July 2019
⚫ Net reserves held by banks stood at USD 5.653 billion, registering an increase of USD 4 million
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TWEET
What Else We’re Reading
Fitch downgrades Pakistan’s issuer default rating to 'CCC+' from ‘B-’ (Business Recorder)
ADB okays USD 1.5 billion in financing for social protection, food security in Pakistan (Dawn)
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