Fear of debt restructuring needs to be overcome, says ex-SBP chief

Rescuing countries from disorderly defaults “hinges on increasing fiscal space by restructuring their debt”, Murtaza Syed, a former acting governor of the State Bank of Pakistan (SBP), wrote in The Economist yesterday, recalling his previous article where he said the International Monetary Fund (IMF) and Pakistani policymakers were “flirting with disaster by pretending that the country’s public debt was sustainable”.

Pakistan and the IMF signed a 37-month staff-level agreement in July for...