Rising debt distress sparks calls for structural overhaul

The Express Tribune reported calls for a major redesign of global debt arrangements, as rising repayment pressures leave many governments with less room to fund development. The article cites global debt of $348 trillion at the end of 2025 and says nearly half of low-income countries were in debt distress or at high risk by September 2025.

It argues that debt workouts should be predictable and preventive, including temporary payment pauses when transparent triggers are met, and that private creditors should be involved earlier. The writer also urges stronger multilateral development bank lending capacity, better public loan data and climate risks in debt assessments. Pakistan is urged to use its 2027 chairmanship of the IMF-World Bank Boards of Governors to promote these changes, including wider use of debt pause clauses.