Pakistan, Japan sign debt suspension pact

ISLAMABAD: Pakistan and Japan on Tuesday signed a debt suspension agreement amounting to $367 million under G-20 Debt Service Suspension Initiative (DSSI).

According to an official announcement made here by the Economic Affairs Division (EAD), the governments of Pakistan and Japan signed debt suspension agreements amounting to $367 million under the G-20 Debt Service Suspension Initiative (Phase-I). Noor Ahmed, Economic Affairs Division Secretary and Kuninori Matsuda, Ambassador of Japan to Pakistan, signed the agreement in Islamabad. The signing ceremony was witnessed by senior officials of the Japanese Embassy.

In the wake of COVID-19, the G20 countries, together with the Paris Club creditors, announced a Debt Service Suspension Initiative (DSSI) to provide much needed fiscal space to stressed countries to meet their urgent economic and health needs. The government of Pakistan taking advantage of this initiative entered into negotiations with 21 creditor countries for debt suspension amounting to US $1.6 billion under DSSI Phase-I (April–December, 2020). The government of Pakistan will repay the suspended amount in four years starting January, 2022. On this occasion, the EAD secretary reiterated his appreciation for the debt suspension provided by Japanese government. Ambassador Matsuda also reaffirmed Japanese support to Pakistan on issues of mutual interest.