LAHORE: Pakistan Kissan Rabita Committee has demanded that the debt of countries facing the financial crunch must be at least postponed for four years so that the money saved from debt servicing could be used on public health programs such as the building of hospitals and procurement of vaccines.
In a press release, it said that there is an international campaign by social movements to put pressure on G-7 to change their path in favour of human-centred development. “We are here to draw your attention to the G7 Summit that is taking place in the UK from June 11 to June 13,” it added.
“The pandemic has hit the world economy especially the developing countries in the global south. The threat to global development is also severe: between 130 million and 500 million people worldwide may fall back into extreme poverty this year, defined as living on less than $1.90 per day. As a result, numerous experts predict that progress toward the 2030 Sustainable Development Goals is not only slowing, but may be moving in reverse. Even in the most optimistic scenarios, COVID-19 will likely result in lost decades of development.”
“The looming debt crisis in the face of a pandemic is a threat to common people in developing countries. Nearly half of emerging markets and developing economies (EMDEs) were already at high risk of debt crisis before COVID-19 was declared a global pandemic by the World Health Organization in March 2020. Since then, the debt situation has only worsened. The IMF projects that average 2021 debt ratios will rise by 7-10 percent of GDP in these countries.”
“Reports from Pakistan are also worrying. Latest reports suggest that the country plans to borrow $16 billion of fresh debt. This is the largest debt that will ever be borrowed in a fiscal year by Pakistan and the consequences of such a step will have to be borne by common people in the shape of rising utility prices such as oil and gas. In the last three years, the Imran Khan-led government in Pakistan has borrowed $49 billion of debt from financial creditors. According to Imran Khan’s own government it has spent $20 billion in debt servicing in the last three years.”
“There is still no recognition of illegitimate debts although this has been recognized by the UN and even by the World Bank at one point. The call for the immediate and unconditional cancellation of all illegitimate debts is strongly founded on ethical and justice imperatives. These are debts contracted by governments on behalf of their peoples but have been used to finance socially and environmentally harmful projects, exacerbated the climate crisis, exploited women’s labors, bound us to highly onerous and unfair terms, violated rights and democratic processes and laws, and threatened our future and generations yet to come. They include debts of private corporations but assumed as public liabilities. Many of these debts have already been paid for or still being claimed with public funds that could have gone to strengthening public social services such as health, housing, water and sanitation.”
“G7/G20 ignores the rising demand for debt cancellation, expressed by more than 550 civil society organizations worldwide in the face of the COVID-19 induced multiple crises even as it claims “continued support to low-income and vulnerable countries”. For 2021 alone, debt service payments amounted to nearly $1.1 trillion; less than 3% of this money could vaccinate 2 billion people.”
“We, therefore demand from G7/G20 countries to cancel all the illegitimate debt. The debt of countries facing the financial crunch must be at least postponed for four years so that the money saved from debt servicing could be used on public health programs such as building of hospitals and procurement of vaccines. We also demand that vaccines should be donated instead of providing loans for its procurement.”
“We also demand from the government of Pakistan to use the debt servicing money on public welfare programs, increase vaccination drive and provide relief to the people by setting minimum wage of 30 thousand and providing additional 20 thousand as pensions so that people could survive in this rising inflation.”