INSUBCONTINENT EXCLUSIVE:
economic crisis in more than seven decades, which has led to shortages of essentials and the ouster of a president.The country expects to
renegotiate its debt with private and official creditors after the IMF board approval of the loan, which is expected by mid-December
From now until mid-November, the country looks forward to obtain financing assurances from public- and private-sector creditors.It aims to
reach agreements in principle with all the creditors between the last quarter of the year and the second quarter of 2023, the sources
participating in the event said.The country earlier this month reached a staff-level agreement with the IMF for the loan of about $2.9
billion, contingent on it receiving financing assurances from official creditors and negotiations with private creditors.The virtual
presentation to investors on Friday marks the first time the Sri Lankan government has formally engaged with private bondholders after
deciding earlier this year that it would restructure $13 billion in international sovereign bonds, held by private creditors such as asset
managers BlackRock and Ashmore.Central Bank Governor Nandalal Weerasinghe and the Treasury Secretary Mahinda Siriwardena participated in the
virtual presentation, along with representatives of financial and legal advisers Lazard and Clifford Chance.Bilateral Debt TalksSri Lanka
also needs to renegotiate debt with bilateral creditors such as China, Japan and India
The sources attending the presentation said Sri Lankan government officials said the country is encouraging an ad-hoc bilateral creditor
coordination platform to obtain financing assurances from official bilateral creditors.As a middle-income country, according to the World
Bank, Sri Lanka is not able to engage in talks with bilateral creditors under the G20 common framework for debt treatments.The country
officials added that the ad-hoc platform should be established by the creditors themselves as soon as possible, while the government is only
promoting it.The sources said a representative from Lazard, which is advising the government, said that this initiative would resemble the
It will offer equal footing for creditors to access relevant information and a forum to discuss emergency credit lines, the presentation
showed in March.Government officials added that the perimeter for a local debt restructuring is still being looked into because of its
impact on the domestic banking system, and no final decision has been made yet
No default on any local currency debt has occurred so far, they added.The central bank governor said that the country has paid Sri Lanka
Development Bonds in both dollar and local currency
This article first appeared/also appeared in https://adaderana.lk
