Pakistan Tehreek-e-Insaf (PTI) leader Muzammil Aslam shared a unique solution for Pakistan to repay its foreign debt by selling the gold possessed by females and goldsmiths in Pakistan.
He wrote that if each Pakistani female holds 10-gram gold on average, then Pakistan has 1200 tons of gold. With 5 gram average of 600 tons. With a 1-gram average of 120 tons. “Which number do you pick?”, he added.
Read more: Pakistan: A country caught in complex economic downturn
I ton gold cost $58mn. Then each 100 ton gold worth is $5.8bn. Assuming we have 1200 tons of gold then the value is $69.6bn, 600 tons then $34.8, if 120 tons the $6.96. Goldsmith alone holds 40 tons which is $2.32bn. Pakistan can repay half of its foreign debt through gold. https://t.co/GE3cuLJZwx
— Muzzammil Aslam (@MuzzammilAslam3) October 5, 2022
Muzammil said that there are about 40,000 jewelry shops operating in the country. If each shop holds 1 kg gold then it is estimated to have 40 tons of gold possess by Goldsmiths.
He added that if one ton of the precious metal costs $58mn. Then each 100-ton worth is $5.8bn. “Assuming we have 1200 tons, then the value is $69.6bn, 600 tons then $34.8 if 120 tons the $6.96. Goldsmith alone holds 40 tons which is $2.32bn,” he estimated.
“Pakistan can repay half of its foreign debt through gold,” he concluded.
Suspension of Pakistan’s international debt repayments
Pakistan should suspend international debt repayments and restructure loans with creditors after recent floods added to the country’s financial crisis, the Financial Times reported, citing a UN policy memo.
The memorandum states that the country’s creditors should consider debt relief so that policymakers can prioritize financing its disaster response over loan repayment, the newspaper said.
Read more: Flood-hit Pakistan should suspend debt repayments, says UN paper
Pakistan has earlier estimated the damage at $30 billion, and both the government and UN Secretary General Antonio Guterres have blamed the flooding on climate change.
The memo further proposed debt restructuring or swaps, where creditors would let go of repayments in exchange for Pakistan agreeing to invest in climate change-resilient infrastructure.