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IMF able to help Sri Lanka’s discussions with bondholders

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The International Monetary Fund (IMF) emblem. File.
| Photo Credit: Reuters

The International Monetary Fund (IMF) stands able to help Sri Lanka’s discussions with worldwide bondholders and can present a proper evaluation after the events attain a tentative agreement-in-principle, an IMF spokesperson mentioned on April 18.

“We hope an agreement consistent with the parameters of the IMF-supported program and official creditors’ Comparability of Treatment requirements can be reached soon, ahead of completing the second review under the program,” the spokesperson mentioned.

Sri Lanka mentioned it failed to achieve an settlement with bondholders to restructure about $12 billion debt earlier this week, elevating issues there may very well be a delay within the island nation receiving a 3rd tranche of its $2.9 billion IMF program in June.

The authorities mentioned one of many important hindrances had been that the “baseline parameters” of the bondholders’ plan had not matched these embedded in its IMF program.

“We encourage each events to proceed their discussions swiftly,” the IMF assertion added.

Sri Lanka will seek the advice of with the IMF to evaluate if the most recent proposals mentioned with bondholders had been throughout the parameters of its bailout program.

The island nation defaulted on its international debt in May 2022 and kicked off negotiations with bilateral collectors a number of months later, finally securing an settlement in precept with China, India and the Paris Club final November.

Sri Lanka plunged into its worst monetary disaster since independence from the British in 1948 after its international trade reserves fell to file lows in early 2022, leaving it unable to pay for necessities together with gasoline, cooking fuel, and drugs.

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