WASHINGTON: Developing countries spent nearly half a trillion dollars to service their external public and publicly guaranteed debt in 2022, draining funds from critical health, education and climate needs, and putting the poorest countries at increasing risk of “tumbling into a debt crisis,” the World Bank said on Wednesday.
In its latest International Debt Report, the bank said the debt-service payments — including principal and interest — rose 5 percent to a record $443.5 billion from a year earlier amid the biggest surge in global interest rates in four decades. It said the payments could shoot 10 percent higher in 2023-2024.
The 75 poorest countries were hardest hit, said the report, now in its 50th year. Their external public debt service payments reached a record $88.9 billion in 2022 and would surge by 40 percent over the 2023-2024 period. Their interest payments alone had quadrupled since 2012 to $23.6 billion, it said.
“This is the decade of reckoning,” World Bank chief economist Indermit Gill told Reuters in an interview. “Record debt levels and high interest rates have set many countries on a path to crisis,” he said, warning that continued high interest rates would push more developing countries into debt distress.
Gill said he was paying close attention to Ethiopia’s discussions with bondholders after a breakdown in talks over how long to extend the maturity and spread out repayments of its single $1 billion international bond maturing in December 2024.
“Ethiopia is like a canary in the coal mine,” he said. “It’s the biggest country that would default. That’s an important one. It’s one of the five biggest economies in sub-Saharan Africa.”
Ethiopia is careening toward default after it said last week it could not pay a $33 million bond coupon due on Monday.
Gill told reporters that steep debt servicing costs, high debt burdens and slowing growth in many countries raised concerns about a new debt crisis and the risk of contagion, but said he does not view that risk as “imminent.”
He said the situation would remain difficult for developing countries, with past experience indicating that interest rates were unlikely to come down “anytime soon” especially since supply shocks could jack up inflation again quickly.
Gill called for “quick and coordinated action” by debtor countries, private and official creditors, and multilateral financial institutions to improve transparency, develop better debt sustainability tools, and speed up debt restructurings.
African countries faced “another lost decade,” Gill told Reuters, noting they had seen no per capita income growth since 2014 on average.
The report said one in every four developing countries was now priced out of international capital markets and there had been 18 sovereign debt defaults in 10 countries over the past three years, more than in the past two decades combined.
Debt service payments consumed an ever-larger share of export revenues, with some countries now “just one shock away from a debt crisis,” Gill wrote in the report, noting that about 60 percent of low-income countries are already in or at risk of debt distress.
Domestic debt levels were also high in countries like Argentina and Pakistan, increasing risks. Countries that deferred making principal and interest payments under the Group of 20’s Debt Service Suspension Initiative (DSSI) adopted during the COVID pandemic also faced additional costs now that those payments were due, the bank said, although exact data won’t be reported until 2024.
The report noted private capital had largely withdrawn from developing countries, favoring higher interest rates in advanced economies. Private creditors received $185 million more in principal repayments than they disbursed in loans, the first time that was seen since 2015.
Overall, there was a net outflow of $127.1 billion from low- and middle-income countries to bondholders, compared to an average inflow of $202 billion from 2019-2021.
The World Bank and other multilateral creditors, helped fill the gap, providing a record $115 billion in new financing for developing countries in 2022, the report said.
Pakistan, other developing countries, spent record $443.5 bln to service public debts in 2022 — World Bank
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Pakistan, other developing countries, spent record $443.5 bln to service public debts in 2022 — World Bank
- Servicing external debts drains funds from critical health, education and climate needs, says World Bank report
- Continued high interest rates would push more developing countries into debt distress, says World Bank’s chief economist
Pakistan’s Muhammad Asif wins IBSF World Snooker Championship in Qatar
- Asif defeated Iran’s Ali Ghareghozlou 5-3 to clinch the title for 3rd time
- PM Shehbaz Sharif promises to set up world-class facilities for sportsmen
ISLAMABAD: Prime Minister Shehbaz Sharif has congratulated Pakistani cueist Muhammad Asif for winning the International Billiards and Snooker Federation (IBSF) World Snooker Championship in Qatar for the third time, Pakistani state-run media reported on Thursday.
Asif defeated Iran’s Ali Ghareghozlou 5-3 to clinch the title in a thrilling final on November 6, 2024. He outclassed Ali 5-3: 70-25, 7-87(84), 82(56)-8, 106(106)-08, 82-12, 43-91(58), 0-118 and 93(80)-4.
“Asif made the entire nation proud by winning the international championship for the third time,” PM Sharif was quoted as saying by the Radio Pakistan broadcaster. “The talented youth of Pakistan are highlighting the country’s name in the fields of sports.”
The IBSF, founded in 1971, is the governing body for billiards and snooker worldwide. It represents 85 member countries and is recognized by the World Confederation of Billiard Sports and the International Olympic Committee.
Asif, 42, first won the IBSF World Snooker Championship in 2012 and went on to win it again in 2019. His victory ties him with India’s Pankaj Advani who has also won the World Snooker Championship thrice.
The Pakistan prime minister said Asif’s family and coach also deserved recognition, adding that providing quality facilities to Pakistani players was top priority of his government.
“The government is making all possible efforts to provide international standard facilities to the players,” he added.
China, Pakistan discuss advancement of rail, road and economic zone projects under CPEC
- The discussions included sections of Main Line-1 railway project, Karakoram Highway as well as Gwadar port and economic zone
- Beijing has invested over $65 billion in energy, infrastructure and other projects as part of the China-Pakistan Economic Corridor
ISLAMABAD: China and Pakistan on Thursday discussed advancement of key infrastructure and economic projects under the multi-billion-dollar China-Pakistan Economic Corridor (CPEC), the Pakistani government said, with the two sides also discussing security of Chinese nationals working in Pakistan.
CPEC, a part of China’s Belt and Road Initiative, aims to connect China to the Arabian Sea through a network of roads, railways, pipelines and ports in Pakistan and help Islamabad expand and modernize its economy.
The discussions on key CPEC projects were held during Chinese Ambassador to Pakistan Jiang Zaidong’s meeting with Pakistani Planning Minister Ahsan Iqbal, according to Pakistan’s Press Information Department (PID).
On the occasion, the Pakistani planning minister emphasized the need for concrete mechanisms to ensure smooth and effective implementation of bilateral projects.
“Both sides deliberated on advancing key projects, including the Karachi-Hyderabad section of Main Line-1 (ML-1) and Karakoram Highway (Thakot-Raikot Section) project, and agreed to accelerate the projects’ timely execution,” the PID said in a statement.
“Regarding the Gwadar Port and Free Zone, both sides expressed a mutual commitment to ensuring the continued development of Gwadar in a holistic manner.”
The meeting came two days after a security guard at a factory in the southern Pakistani city of Karachi shot and injured two Chinese nationals before fleeing, police said.
Last month, two Chinese nationals were killed in a suicide bombing near the international airport in Karachi. In March this year, a suicide bombing killed five Chinese engineers and a Pakistani driver in northwestern Pakistan as they headed to the Dasu Dam, the biggest hydropower project in the country. In 2022, three Chinese educators and their Pakistani driver were killed when an explosion ripped through a van at the University of Karachi. A blast on a bus killed 13 people in north Pakistan in 2021, including nine Chinese nationals.
China, breaking with tradition, publicly spoken out against security threats to its workers and nationals living in Pakistan, where hundreds of them work on Beijing-funded projects linked to CPEC.
Iqbal assured the Chinese ambassador the safety of Chinese citizens was a top priority of his government.
“Pakistan will continue working closely with China to ensure the security of Chinese citizens, projects, and institutions,” he was quoted as saying by the PID.
Ambassador Jiang expressed gratitude for Pakistan’s comprehensive engagement and said the Chinese side was ready for collaboration in areas of agriculture, mines and minerals, industrial cooperation, according to the PID.
Iqbal shared that his ministry was in coordination with the National Development and Reform Commission of China to arrange high-level workshops to bring together experts from both sides to outline the future direction of CPEC’s second phase.
China has lately shown willingness for the second phase of CPEC and has given assurances for the establishment of five new corridors, including that of growth, livelihood, innovation, green economy and open regional inclusive development.
Pakistan to press developed nations for unconditional climate funding at COP29
- Pakistan is ranked as the 5th most vulnerable country to climate change, according to the Global Climate Risk Index
- Pakistan PM’s aide Romina Khurshid Alam says vulnerable countries are suffering from their own economic challenges
ISLAMABAD: Pakistan will urge developed countries attending the upcoming Conference of the Parties (COP29) in Baku to fulfill their pledges and provide easy access to climate funding without attaching conditions, Prime Minister Shehbaz Sharif’s coordinator on climate change said on Thursday.
The COP29 climate conference, scheduled to take place in Baku between November 11 and 22, will layout new policies and bring together representatives from various nations to discuss the adverse impacts of climate change and evaluate available solutions for adaptation.
Pakistan is ranked as the 5th most vulnerable country to climate change, according to the Global Climate Risk Index. In 2022, devastating floods affected over 33 million people and caused economic losses exceeding $30 billion, highlighting the country’s high susceptibility to extreme weather events.
“Pakistan is very clear on our stance that we need all the developed countries when it comes to the pledges, one, they need to complete their pledges, they need to fulfil their pledges, and two, easy access toward the fundings,” Romina Khurshid Alam, PM Sharif’s coordinator on climate change, told Arab News in an exclusive interview.
Due to the rising temperatures, extreme climatic phenomena, including floods, droughts, cyclones, torrential rainstorms and heatwaves, have been occurring more frequently and with greater intensity across Pakistan.
The South Asian country is among the most severely threatened countries in terms of climate–induced challenges, especially in the context of its dependency on climate-sensitive sectors such as agriculture, water, natural resources and the environment, and socio-economic issues such as poverty. The country’s adaptation to the adverse impacts of climate change is inevitable and likely to become critical in the future.
Alam said vulnerable countries were suffering from their own economic challenges and vulnerabilities, while at the same time, many countries faced additional restraints on climate funding.
“It’s not fair that we always get demands to ‘do more and to do this, to do that, these sanctions are coming,’ that is something which is on the human rights violation as well,” she said, adding that Pakistan wanted to raise its voice on what happened to the pledges, how many countries benefited from them and what straightforward mechanisms could be pursued to provide effective support.
Asked about the total amount pledged by developed nations, Alam said she would provide the exact figure after COP29, but noted that “the number is very low.”
“At COP29, we are talking about the data bank system like in a way that what countries are suffering and looking forward for the carbon credits policies,” she added.
Last month, Pakistan proposed the establishment of a regional climate data bank to help Vulnerable Twenty (V20) group of countries prepare an evidence-based response to climate disasters.
Alam said the South Asian country had planned “many things” to showcase at Pakistan Pavilion during COP29.
Speaking about the prevailing smog issue, she said Pakistan would take it up with the Indian team at COP29.
“We are open to dialogues and open to come up with the solution, we want to get the things done by dialogue,” she said, noting that the chief minister of Pakistan’s Punjab, Maryam Nawaz, had also urged India to sit together to resolve this issue.
“CM Punjab very clearly said that ‘let’s sit together to sort out this issue because this cannot be done in a way that we are not doing this or you are doing this’,” Alam said.
“This is not a game, the main thing is to think about the children and to think about the future.”
Winter smog has become an annual crisis in Pakistan’s Punjab, particularly the provincial capital of Lahore, with air quality deteriorating to hazardous levels each season. The city consistently ranks among the world’s worst for air pollution, leading to a significant rise in respiratory issues and hospital admissions, especially affecting children and the elderly.
Last year, severe pollution levels prompted a surge in cases of asthma, lung infections and other respiratory problems among residents, according to media reports.
The problem this week prompted Punjab CM Nawaz to propose cross-border cooperation with Indian authorities to tackle shared pollution sources, such as crop residue burning, which exacerbate the region’s smog problem.
Pakistan PM performs groundbreaking of first private sector university in Gilgit-Baltistan
- Ramday University is being built by a trust with construction set to complete by donations from overseas Pakistanis
- Home to some of the world’s tallest mountains, semi-autonomous GB region is among Pakistan’s least developed areas
ISLAMABAD: Prime Minister Shehbaz Sharif this week laid the foundation stone of first private sector university in Gilgit-Baltistan (GB), promising a bright future for the youth of the remote mountainous region.
Home to some of the tallest mountains in the world, the semi-autonomous GB region is counted among the least developed areas administered by Pakistan.
Ramday University is located in Thagos area of GB’s Ghanche district at an altitude of 11,000 feet. The university is being built on a 200-kanal area of land under a trust, with construction set to be completed through the donations of overseas Pakistanis, the state-run Associated Press of Pakistan reported.
GB-based news portal Pamir Times said the university will offer specialized programs in environmental studies, climate change, hydrology and mineral studies subjects.
“The establishment of an institution of higher learning in a remote area like Ghanche in Gilgit-Baltistan is highly encouraging,” Sharif was quoted as saying on by the APP during the groundbreaking ceremony in Islamabad on Thursday.
The prime minister congratulated former Supreme Cour judge Khalil ur Rehman Ramday on establishing the university.
“He expressed his confidence that this university, located at an altitude of 11,000 feet in Thagos, will reach the peak of modern knowledge and research standards,” the APP said.
Sharif stressed that GB’s development and the welfare of its people were among the government’s top priorities.
The development takes place a day after Sharif visited the mountainous northern region, where he inaugurated a model village for flood-affected families during a day-long visit to Ghizer.
There, Sharif pledged to provide residents with ownership documents to help them acquire new houses that were destroyed by the 2022 floods.
Father accused of murder of British-Pakistani girl blames stepmother
- Sara Sharif was found dead in her bed in southwest of London in Aug. 2023 with injuries including broken bones, burns
- Her father, Urfan Sharif, had fled to Pakistan a day before the body was found, along with his wife and the girl’s uncle
LONDON: The father of a 10-year-old British-Pakistani girl on Thursday denied her murder and instead blamed the girl’s stepmother, calling her “evil” and “psycho.”
Sara Sharif was found dead in her bed in Woking, southwest of London, on August 10, 2023 with injuries including broken bones, burns and bite marks.
Her father, Urfan Sharif, 42, had fled to Pakistan a day before the body was found, along with his wife Beinash Batool, 30, and the girl’s uncle, Faisal Malik, 29.
Sharif then called police in the UK shortly after arriving in Islamabad and said he had “beat her up too much.” During the trial, Sharif said he made up this and another confession to “protect my family.”
All three adults were arrested upon their return to the UK a month later. They deny charges of murder and allowing the death of a child.
Details of the extent of Sara’s injuries have been detailed at London’s Old Bailey court, including claims from Batool that Sharif would beat his daughter badly.
Giving evidence for a third day, Sharif admitted slapping Sara “multiple times” but denied beating, burning, or biting her, insisting that he was “never at home” when she was injured.
Sharif broke down when his lawyer, Naeem Mian, questioned him about beating Sara, who was home schooled, with a cricket bat.
The taxi driver denied burning his daughter with an iron and instead said he was “made to” slap Sara by Batool, who constantly accused the girl of behaving badly.
Pointing to Batool sitting in the dock, Sharif shouted: “I should not have believed her... I didn’t realize I’m living with evil and a psycho.”
He also suggested that Batool was the one who bit her “like an animal.”
The jury was previously told that Sharif and Malik had provided their dental impressions but Batool had refused.
“I didn’t do it. Faisal didn’t do it. Who else was at home?” Sharif said.
He denied ever being aware of Sara being in pain. “She never told me that,” he said and indicated that he did not see injuries because Sara wore full-sleeve tops and long bottoms as well as a hijab head covering.
In the month leading up to Sara’s death, Mian said Sharif was out of the house at work from early in the morning to late at night while holing frequent telephone conversations with Batool, who would largely be at home.
Sharif wept as he recalled a time he came home and saw that Sara’s hands had been tied behind her back with brown packaging tape, accusing Batool of the act.
Asked why he did not call the police or ask Batool to leave, Sharif said that his wife was “manipulative” and that he believed her apology.
“I have been an idiot,” he added.
Forensic evidence shown to court included bundles of packaging tape and a white plastic carrier bag fashioned into a hood that could have been used on Sara’s head.
The bag had packaging tape stuck to it as well as long, brown hairs that matched Sara’s DNA, the court was told.
Both the bag and the non-sticky side of the tape had fingerprints that matched Sharif’s, who denied fashioning a hood out of the plastic bag or using it on Sara.
He said the fingerprints could be a result of him handling the items while sorting the garbage.
Sharif had previously accused Batool of being abusive toward him and preventing him from asking Sara about how she obtained her injuries.
In 2022, Batool texted her sister that Sharif had suggested using make-up to cover up bruises after beating Sara, to which the sister replied: “LOL it was going to happen you can tell.”
In the days before her death, Sharif said Sara, who did chores around the house, had asked him to “not go to work.”
