ISLAMABAD: Pakistan’s total external debt stock reached nearly USD130 billion by 2024, with debt servicing consuming a staggering 40 percent of export earnings, said the World Bank on Wednesday.
The Bank in its latest report, ‘International Debt Report 2025’, noted that Pakistan’s external debt woes deepened in 2024, as net foreign inflows plummeted over tenfold to USD354 million.
“Net debt flows to the Middle East, North Africa, Afghanistan, and Pakistan region turned negative in 2024, from an inflow of USUSD11.9 billion in 2023 to an outflow of USD4.1 billion. These flows were heavily concentrated in Egypt, where net flows reversed from an inflow of USD5.2 billion to an outflow of USD3.4 billion in 2024, followed by Pakistan, where net flows decreased by more than a factor of 10 to USD354.4 million”, it added.
IMF projects Pakistan’s external debt to rise to $126.731bn by FY26
China remains Pakistan’s largest bilateral creditor, holding 23 percent of the country’s public external debt.
Bangladesh, Nigeria, and Pakistan together account for close to 30 percent of IDA-eligible countries’ debt stock; Mozambique, Senegal, Sri Lanka, and Uzbekistan together account for another 21 percent.
Haiti, the Lao People’s Democratic Republic, Mozambique, Pakistan, Papua New Guinea, and Senegal had the largest total debt service-to-export ratios in 2024; Mozambique, Papua New Guinea, Suriname, and Zambia had the largest total debt service-to-GNI ratios.
Net debt flows from bilateral creditors turned negative for the first time since 2011, from an inflow of USUSD3.9 billion to an outflow of USUSD3.7 billion. Net bilateral debt flows to Pakistan and Iraq drove the trend, led by reductions of more than 75 percent in disbursements from new financing to USD1.5 billion and USD320.7 million, respectively.
Multilateral creditors were the only creditor base that provided positive flows to public sector borrowers in 2024. Most of the region’s increase was attributable to the World Bank’s IBRD. At the country level, increases were largest in Tunisia, Jordan, and Pakistan (primarily because of the 2024 IMF disbursement), but they were offset by Egypt’s surge in principal repayments, primarily to the IMF.
The World Bank report noted that total external debt stocks stood at USD129.718 billion by 2024 including the use of IMF credit and SDR allocations of USD12.321 billion against USD11.532 billion in 2023, long-term external debt of USD107.88 billion in 2024 against USD110.548 billion in 2023.
Public and publicly guaranteed debt, by creditor and creditor type in 2024, including IMF credit includes 49 per cent multilateral, (18 per cent World Bank, 16 per cent ADB, 15 per other multilateral), 43 per cent bilateral (23 per cent China, 5 per cent Saudi Arabia, 6 per cent other bilateral) and 8 per cent private (8 per cent bondholders, 8 per cent multiple lenders).
Copyright Business Recorder, 2025
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