CWS Voices Concern over Possible Debt Burden for Pakistan

The Christian international humanitarian agency Church World Service said it was encouraged by pledges of support for Pakistan at the country’s donor conference on Saturday, but voiced strong concern at the possibility of increasing Pakistan’s debt burden.

|TOP|CWS also called on donor countries to start immediately on making their pledges of fund a reality for the survivors in order to avert further deaths as winter continues to set in on the country and the regions devastated by last month’s earthquake.

In the run-up to Saturday’s donor conference, Rev. John L. McCullough, who visited the country earlier in the month, said: “The job is far from over. The first snow fell in Kashmir this past week.

“Without immediate and major funds for food, for further shelter and medical aid, winter and disease will conspire to produce significant and further death and suffering.”

Rev. McCullough said: “There’s simply not enough to go around here. The UN and World Food Programme will run out of food before December is over and out of funds to keep helicopters and vehicles going by the end of this month. This is not NGO rhetoric; this is reality.”

|QUOTE|Pakistan President Pervez Musharraf’s initial request for $5.2billion for ongoing emergency relief, reconstruction and rehabilitation was exceeded by the more than 70 donor countries, financial institutions and aid organisations in attendance at the conference that promised $5.8billion in cash grants and loans.

The CWS urged, however, that the donor countries turn the cash pledges into an immediate reality for the survivors still awaiting much needed materials and support.

“We are heartened by the generosity of the world’s major donors and particularly by the U.S.’s expanded pledge but historically, following major disasters only about half of the pledges made by donors ever materialise,” says CWS Emergency Response Programme Director Donna J. Derr.

The U.S. alone pledged $510million, including the $156million already given, just slightly less than Saudi Arabia, the largest single donor country at the conference, which pledged $573million in loans and grants.

CWS Pakistan/Afghanistan Regional Director Marvin Parvez warned, however, that approximately 68 per cent of the pledges are loans, although donors are calling them soft loans.

|AD|“But the hard reality is that Pakistan already has $32billion in debt and is paying out billions more in interest on the principal.

“I don’t know how we can help the children of Pakistan by adding to the national debt. As a generation, as a population, our children were so mortally affected by the disaster itself,” he said.

Mr Parvez added: “So many have died, lost parents, are injured and traumatised. The deepened burden of debt just makes the future a bit darker for them.”

He also warned of the negative side-effects of cash grants which could raise inflation, owing to the poor exchange rate, much to the detriment of the rural poor.

“There are no perfect answers,” said Mr Parvez. “But it is important that the terms and conditions for grant contracts should be people friendly, not simply donor friendly.”

Ms Derr added: “We are asking for transparency and accountability from our government, so it is appropriate that we expect the same from international donors.

“What the fine print on grant contracts will say is very important, including how much will go back to the donor country for buying ‘technical expertise’ and equipment, and how much actually goes to the people in distress.”

She urged governments to deliver on their promises for aid: “We hope our donor nations will not only expeditiously deliver on their promises now, to help save the many thousands still homeless or unserved, who are now facing the spread of disease and further illness or death as the Himalayan winter descends.”

CWS also urged the world bodies to stay in it for the long haul to help the 3.3 million left homeless rebuild their lives, a process CWS predicts will take a very long time.

The humanitarian agency continues to provide material aid and support for those affected by the earthquake, with material aid already provided to more than 20,000 families throughout the northern regions of the country.