Sri Lanka Gets Green Light from IMF and Official Creditors To Proceed With ISB Restructuring

COLOMBO (News 1st); Sri Lanka said that consultation process with the country's Official Creditor Committee and the International Monetary Fund was successfully completed. "The Democratic Socialist Republic of Sri Lanka is pleased to announce that, following the Agreement in Principle (AIP) reached with representatives of its international and local holders of International Sovereign Bonds (ISBs) on 19th September 2024, the Sri Lankan authorities have now completed their consultations with Sri Lanka’s Official Creditor Committee (OCC) and the IMF regarding the compliance of the AIP terms with the Comparability of Treatment (CoT) principle and the parameters of Sri Lanka’s IMF- supported program," said the country's finance ministry in a statement on Friday (4) night. The Finance Ministry added that formal confirmation has been received from the OCC that the terms of the AIP as it stands are compatible with the CoT principle. Concomitantly, the authorities have also received confirmation from the IMF staff that the AIP terms meet Program parameters under the EFF arrangement second review macro framework, when considered in conjunction with the restructuring of official claims in line with the terms agreed with the OCC and China Exim Bank in June 2024. "Following the Presidential elections held in Sri Lanka on Saturday 21st September and the appointment of the new Government on 25th September, the Sri Lankan authorities confirm their endorsement of the Program debt targets and the AIP terms as announced on 19 September and confirm their intention to expedite the implementation of the ISBs' restructuring transaction in line with these terms," said the statement. Sri Lanka thanks all its creditors as well as the IMF and the OCC for their good faith engagement and continued support throughout this process, it added.