Govt will not seek Paris Club debt restructuring: Dar

Published October 9, 2022
Finance Minister Ishaq Dar addresses a press conference in Islamabad on Sunday. — DawnNewsTV
Finance Minister Ishaq Dar addresses a press conference in Islamabad on Sunday. — DawnNewsTV

Finance Minister Ishaq Dar on Sunday said Pakistan will not seek debt restructuring from Paris Club creditor nations, as he seeks to restore market confidence after a credit rating downgrade.

The new rating from Moody’s raised concerns that Pakistan could default on its foreign debt as the country contends with economic turmoil and a balance of payments crisis.

“We have decided not to go to Paris Club,” Dar said while addressing a press conference in Islamabad, adding that in consultation with Prime Minister Shehbaz Sharif it was decided that it wasn’t in the nation’s interest to ask for a restructuring.

“We will fulfil all sovereign [debt] commitment,” he said.

Dismissing market rumours that the government might extend maturities for its bonds, Dar said the country will fulfil all multilateral, international and bond obligations.

“God willing, we will pay the bonds on time,” said Dar.

“We are not extending the bond maturity.” Pakistan’s Eurobond matures in December this year.

Moody’s last week downgraded Pakistan’s credit rating from B3 into so-called junk territory at Caa1, citing external risks and concerns about its ability to secure required financing to meet its needs in the next few years.

Dar has previously said that the country will meet the requirement to raise nearly $35 billion in external financing for the 2022-23 financial year.

PM Shehbaz last month made an appeal to the Paris Club for a debt moratorium after the already struggling economy was hit by devastating floods that the government estimates will cause economic losses of up to $30bn.

Nearly 33 million people have been affected and 7.9m displaced after flooding caused by abnormal monsoon rains.

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Time for dialogue
Updated 24 Jun, 2024

Time for dialogue

If the PML-N and PTI remain mired in mutual acrimony, an ever-widening gap will continue to allow non-political forces to assert themselves.
Property taxes
24 Jun, 2024

Property taxes

ACCORDING to reports in the local media, along with the higher taxes imposed on real estate in the recent budget, ...
Fierce heat
24 Jun, 2024

Fierce heat

CLIMATE change is unfolding as predicted by experts: savage heat, melting glaciers, extreme rainfall, drought, ...
China’s concerns
23 Jun, 2024

China’s concerns

Pakistan has no option but to neutralise militant threat to Chinese projects, as well as address its business and political stability concerns.
War drums
23 Jun, 2024

War drums

If it is foolish enough to launch another war in Lebanon, Tel Aviv will be solely responsible for setting the Middle East on fire.
Balochistan budget
23 Jun, 2024

Balochistan budget

BALOCHISTAN’S Rs955.6bn budget for the fiscal year 2024-25 makes many pledges to the poor citizens of Pakistan’s...