Thursday Nov 28, 2024
Thursday Nov 28, 2024
Thursday, 28 November 2024 05:30 - - {{hitsCtrl.values.hits}}
IMF Managing Director Kristalina Georgieva
The International Monetary Fund (IMF) Managing Director Kristalina Georgieva yesterday said Sri Lanka achieved a significant step forward in terms of External Debt Restructuring following the setting up of the Exchange of International Sovereign Bonds and wide acceptance from creditors.
In a statement, Georgieva said: “The Sri Lankan authorities have been implementing an ambitious economic reform program supported by the IMF, which aims to restore debt sustainability and external viability, underpin broad macroeconomic reforms, and strengthen economic governance and transparency. Sri Lanka’s economic reform program is supported by an SDR 2.286 billion (about $ 3 billion), 48-month Extended Fund Facility (EFF) arrangement, approved by the IMF’s Executive Board on 20 March 2023. The program has gotten off to a good start with the economy recovering, inflation remaining low, and reserves being accumulated. Following the completion of two reviews, IMF staff reached staff level agreement with the authorities on 23 November for the third review under the arrangement. In June 2024, Sri Lanka agreed on a memorandum of understanding with the Official Creditors Committee (OCC) and reached a final agreement with China EXIM Bank that would deliver a debt treatment by those creditors aimed at restoring debt sustainability consistent with IMF program parameters.”
“Building on this progress, and following several months of constructive discussions, the agreements reached by the Sri Lankan authorities with both the Steering Committee of the Ad Hoc Group of external bondholders, and the Local Consortium of Sri Lanka, mark a significant step forward. The terms of these agreements have been assessed by the Fund staff as being in line with the parameters of the IMF-supported program,” Georgieva said.
“Anchored by policies under the IMF-supported program, the successful implementation of these agreements will provide significant external debt service relief and further contribute to Sri Lanka’s efforts to restore debt sustainability,” she added.
The IMF Chief said to capitalise on this momentum, rapid completion of the debt operation with high creditor participation would be vital for the success of the program. In parallel, the authorities continue to finalise other remaining debt restructuring agreements. This collective effort is key to supporting the success of Sri Lanka’s debt restructuring efforts.
“The Sri Lankan authorities have reaffirmed their determination to persevere with their reform agenda and put the economy on a path of sustained and high growth. The continued support from international financial institutions and other official creditors, together with the participation of bondholders in a debt exchange consistent with debt sustainability, is necessary to underpin the success of these reform efforts. The IMF remains a steadfast partner in supporting Sri Lanka and its people and stands ready to assist the country achieve its economic and social reform goals,” IMF Chief Georgieva added.
