Flood-hit Pakistan should suspend debt repayments, says UN policy memo

Flood affected people gather near their houses as they wait for relief aid in a flooded area following heavy monsoon rains in Rajanpur district of Punjab province on September 4, 2022. (AFP)
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Updated 23 September 2022
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Flood-hit Pakistan should suspend debt repayments, says UN policy memo

  • Memo states Pakistan’s creditors should consider debt relief so policymakers can prioritize financing disaster response over loan repayment
  • Pakistan has estimated damage at $30 billion, government and UN Secretary General Antonio Guterres have blamed flooding on climate change

Pakistan should suspend international debt repayments and restructure loans with creditors after recent floods added to the country’s financial crisis, the Financial Times reported on Friday, citing a UN policy memo.

The memorandum, which the UN Development Programme will share with Pakistan’s government this week, states that the country’s creditors should consider debt relief so that policymakers can prioritize financing its disaster response over loan repayment, the newspaper said.

Pakistan has earlier estimated the damage at $30 billion, and both the government and UN Secretary-General Antonio Guterres have blamed the flooding on climate change.

The memo further proposed debt restructuring or swaps, where creditors would let go of repayments in exchange for Pakistan agreeing to invest in climate change-resilient infrastructure, FT said.

Floods have affected 33 million Pakistanis, inflicted billions of dollars in damage, and killed over 1,500 people — creating concern that Pakistan will not meet debts.


Debris removal steps up at Karachi fire-hit plaza as death toll nears 60

Updated 41 min 6 sec ago
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Debris removal steps up at Karachi fire-hit plaza as death toll nears 60

  • KMC teams remove debris under safety precautions as search for the missing continues
  • Authorities are keeping agencies on alert amid rain forecast as the site remains unstable

ISLAMABAD: Municipal and rescue teams stepped up debris removal operations at a fire-hit shopping plaza in Pakistan’s largest city of Karachi on Wednesday, as officials said the death toll from the blaze has climbed to nearly 60 and the search for missing victims continues.

Teams from the Karachi Metropolitan Corporation (KMC) are clearing rubble from Gul Plaza, a multi-story shopping complex where a fire broke out late Saturday, under strict safety measures, with debris being transported to a designated ground in the city’s Meva Shah area, an official statement said.

“Rescue teams are continuously engaged in search and clearance operations to locate any remaining victims,” the statement circulated by the KMC said, adding that authorities were aiming to complete the process as soon as possible while ensuring safety.

Located in Karachi’s densely populated Saddar district, the fire at Gul Plaza burned for more than 24 hours before being brought under control. The blaze gutted more than 1,200 shops, triggered partial structural collapse and left dozens of people trapped inside.

With rain forecast in the coming days, authorities have placed all relevant departments on alert and are making contingency preparations to prevent further risks at the site, the KMC statement said.

The disaster at the shopping mall has renewed scrutiny of fire safety standards in Karachi’s commercial buildings, where overcrowding, illegal construction and weak enforcement have repeatedly contributed to deadly incidents.

Following the Gul Plaza fire, the Sindh Building Control Authority has warned developers and building owners to address fire safety violations or face legal action.

Deadly fires remain a recurring threat in the city of more than 20 million people, despite periodic crackdowns ordered after major disasters.