Under phase one of the G20 Debt Service Suspension Initiative, Pakistan and Japan inked debt suspension agreements worth $367 million on Tuesday (DSSI).
The agreements were inked in Islamabad by Economic Affairs Division Secretary Noor Ahmed and Japanese Ambassador to Pakistan Kuninori Matsuda.
Following Covid-19, the G20 countries, along with the Paris Club creditors, declared a debt service suspension to give stressed countries much-needed fiscal flexibility to enable them fulfill urgent economic and health requirements.
Taking advantage of the initiative, Pakistan’s government went into debt suspension negotiations with 21 creditor countries totaling $1.6 billion under the DSSI phase-1 (April-December 2020). Beginning in January 2022, the government will refund the suspended amount over a four-year period.
Ahmed expressed his gratitude to the Japanese government for providing the debt suspension facility. He emphasized that Japan was Pakistan’s second-largest bilateral lender.
