Unlocking the Chains of Debt

“If the debtor is in a difficulty, grant him till it is easy for him to repay. But if ye remit it by way of charity, that is best for you if ye only knew” – The Qur’an, 2:280

Author: Muhtari Aminu-Kano, Louiza Chekhar, Reyhana Patel (Islamic Relief) and Tim Jones (Jubilee Debt Campaign)
Country: Pakistan
Category: Human Development & Poverty

Pakistan’s economy has been paralysed by an unpayable and largely unjust debt burden that is preventing the country reaching its poverty goals and hindering the development of democracy, says a new report from Jubilee Debt Campaign and Islamic Relief. Unlocking the Chains of Debt criticises the IMF for the crippling conditions attached to its loans and calls for repayments to be frozen while the legitimacy of all debts is investigated.

Unlocking the Chains of Debt shows that Pakistan’s government foreign debt burden has doubled since 2006 to $58 billion. It warns that annual repayments are set to increase dramatically to $6 billion a year – over 20% of export revenues, and more than half what Pakistan currently spends on health and education combined.

The legitimacy of these debts is highly questionable, say the Jubilee Debt Campaign and Islamic Relief, who are calling for an immediate freeze on repayments and an audit of all debts to establish which should be paid and which should be cancelled. The repayment burden is undermining the fight against poverty and is also a serious threat to the country’s stability.

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