COLOMBO: Cordinate restructuring of Sri Lanka’s debt.
Addressing the launch of Sri Lanka’s debt restructuring process, the IMF’s Deputy Managing Director had said that an expeditious debt resolution is needed for Sri Lanka to emerge as quickly as possible from its crisis.
Okamura also expressed hope that all bilateral creditors would participate in negotiations and complete them before the first review.
Sri Lanka owes USD 7.1 billion to bilateral creditors, government data show, with USD 3 billion owed to China, followed by USD 2.4 billion to the Paris Club of creditor nations and USD 1.6 billion to India.
The Extended Fund Facility (EFF) program of the IMF approved by its executive board in March comes with strict conditionalities for economic reforms.
Sri Lanka had to secure assurances from official bilateral creditors that they would help debt relief and/or financing to restore debt sustainability consistent with the IMF-supported EFF program, as well as an assessment that the authorities are making good faith efforts to reach a private agreement with private creditors.
As these requirements were met ahead of the IMF Board meeting in March, the IMF approved the 48-month extended arrangement of 2.286 billion SDR (Special Drawing Rights), which amounts to USD 3 billion, for Sri Lanka.
