After the floods, Pakistan needs reparations, not charity

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After the floods, Pakistan needs reparations, not charity

Cancel the debt, or let the Bretton Woods group of countries profit from climate disaster, writes Farooq Tariq.


A girl carries her sister as she walks through flood water, after rains and floods during the monsoon season in Nowshera, Pakistan, September 4, 2022. REUTERS/Fayaz Aziz

At the time of writing (September 2022), more than one-third of Pakistan is under water. There were flash floods from unusual monsoon rains and 1350 people have died so far. One million residential buildings are totally or partly damaged. More than 50 million people have lost their homes. We expect the flood to add $10 billion worth of damage to an already weak economy. More than 793,900 livestock have died, and families across Pakistan have lost food and income. The floods have affected about two million acres of crops and orchards.

It is clear that the effects of the floods show the growing speed of the climate crisis. Pakistan produces less than one per cent of global carbon emissions, but it suffers some of the worst consequences of the climate crisis globally. The nation is regularly in the Global Climate Risk Index as one of the top ten most vulnerable countries in the world over the past twenty years. Julien Harneis is the UN humanitarian coordinator in Pakistan. He says, ‘Climate change is driving the super floods — the causes are international’.

The people of Pakistan are the latest to suffer from a global crisis and they have done almost nothing to cause it. The cause has been the excess CO2 emissions of rich countries and businesses. This great injustice is the reason for the increasing demands from Pakistan and the Global South for climate reparations.

One of the demands is debt cancellation. Debt injustice and the climate crisis go together. As extreme weather increases, countries such as Mozambique and island states in the Caribbean are facing more and more economic damage. After such extreme weather, low-income governments, often already with large debts, don’t have enough money and have to take out more loans to rebuild jobs and communities.

We can already see this happening in Pakistan. Even before the floods, Pakistan had very big debts. It faced a big fall in foreign exchange because of high commodity prices and a rise in the US dollar. The cost of electricity and food has increased so much. By the end of 2022, Pakistan will pay about $38 billion dollars to the IMF, World Bank, and other financial institutions including the Chinese State Bank. The debt is creating an economic crisis.

The floods have resulted in a lot of foreign aid, with USAID giving $30 million, and the United Nations $3 million last week. The UN is starting a new flood relief plan for Pakistan, as it called for more money from around the world. But it is not enough.

As humanitarian organizations looked for emergency funds, debt appeared again. The International Monetary Fund (IMF) accepted a request with a plan to give $1.1 billion to the country. At first, this may seem like an important step to help Pakistan, but to put a country in more debt will end in disaster.

It seems clear that a large part of government debt harms the possibility for economic growth, and often the effect gets worse as debt increases. Pakistan’s debts make it more vulnerable to economic shocks and makes the country weaker politically with its powerful lenders. It is also more difficult for Pakistan to invest in education and healthcare, or its infrastructure.

If the West plans to support Pakistan through this crisis, it needs to take action on the damage by the Global North on the South since the Industrial Revolution. As a first step, this should include debt cancellation, and increased climate finance to support communities to adapt to the effects of climate change.

Also, many climate-vulnerable countries including Bangladesh, Ethiopia, and Tuvalu are now also calling for compensation from rich countries for the disasters they are now facing.

This is often called ‘Loss and Damage’. Even now in 2022 it is still not part of the agenda at the UN climate change conference, COP. Climate-vulnerable countries have so often demanded climate compensation from the rich countries and businesses creating the climate crisis. Always their demands are blocked. There must be more real progress on these discussions.

The idea of cancelling debt is not new. During the pandemic, there was some debt relief for low-income countries, but the private sector has continued to collect payments – this made the economic crisis worse after Covid-19. But even private creditors will listen when there is a strong moral demand. In July 2022, a few months after Russia’s invasion, Ukraine’s creditors agreed to stop collecting debt payments during the war. This was so important for the Ukrainian economy and allowed the country to spend every penny on supporting its people.

If international institutions stopped collecting debts, Pakistan wouldn’t need new loans. They could then spend the money on rehousing the millions who lost their homes. Pakistan needs at least four years to rebuild and reconstruct its economy and to repair the damage from the floods and heavy rains.

But there is still a bigger question: who should pay for the climate crisis? Why should Pakistan need loans to pay for the effects of a crisis it did not cause? Pakistan’s climate minister Sherry Rehman told The Guardian newspaper that we need to think again about global emission targets and reparations because of the climate disasters hitting countries such as Pakistan.

Of course, fixing the crisis is not as simple as writing a cheque, and we need to do many things to support Pakistan’s people through the crisis they are facing.

But without debt relief or money to pay for loss and damage, Pakistan’s debt and climate crises will get worse.


(This article is in easier English so it is possible that we changed the words, the text structure, and the quotes.)