•  Official creditor committee comprising 17 countries stresses importance of private and other official bilateral creditors providing a debt treatment on terms as favourable as agreed in line with comparability of treatment principle
•  China among countries attending meeting as observers
•  Total external debt under proposed treatment is $ 21.9 b

Sri Lanka on Tuesday formally requested for a debt treatment at the inaugural virtual meeting of official creditors. Seventeen countries formally formed an official creditor committee co-chaired by India, Japan and France, to discuss the Sri Lankan authorities’ request for a debt treatment. The committee includes Paris Club creditors as well as other official bilateral creditors. This first meeting on Tuesday was following the successful launch of the debt restructuring process for Sri Lanka led by the co-chairs on 13 April. “The Sri Lankan authorities attended the meeting and formally presented their request for a debt treatment. They reiterated their commitment to transparency and comparability of treatment towards their official bilateral creditors,” a post-meeting statement said.

Bilateral creditors hold $ 7.1 billion of Sri Lanka’s external debt whilst private creditors hold $ 14.8 billion bringing the total debt under treatment to $ 21.9 billion. Sri Lanka’s total external debt was $ 29.5 billion as per data released by March.

The IMF and World Bank representatives presented the latest macroeconomic developments regarding Sri Lanka and the current status of their relationship with the country.

The creditor committee took note of the open letter addressed by President Ranil Wickremesinghe to all its official bilateral creditors on 14 March ensuring transparency and comparability of treatment for all external creditors and ensuring that no side arrangements inconsistent with comparability of treatment will be made with any creditor.

The committee also welcomed the passage of the resolution for implementation of the IMF-supported programme by the Sri Lankan Parliament on 28 April.

The creditor committee for Sri Lanka will pursue its work to find an appropriate solution to Sri Lanka’s external debt vulnerabilities, consistent with the parameters of the IMF program.

It stressed the importance for private creditors and other official bilateral creditors of Sri Lanka to provide a debt treatment on terms at least as favourable as the ones agreed by this creditor committee, in line with the comparability of treatment principle. It reiterated its invitation to other bilateral official creditors to formally join the creditor committee.

The members of the creditor committee are representatives of countries with eligible claims on Sri Lanka.

Paris Club members with no eligible claims as well as China, Saudi Arabia and Iran attended the meeting as observers.

Representatives of the International Monetary Fund and the World Bank Group attended the meeting as well.

IMF team in town