Thursday, April 18, 2024

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UK to support SL to secure extended financial facility with IMF

The United Kingdom stands ready to give its assurance as a member of Paris Club to the International Monetary Fund (IMF) for Sri Lanka debt restructuring paving the way for the unlocking of the US $ 2.9 billion extended fund facility.

The UK is fully supportive of the proposed Coordination Platform between Sri Lanka’s Paris Club and non-Paris Club creditors, which we believe represents the most efficient way to restore debt sustainability in Sri Lanka,” Minister of State (Foreign, Commonwealth and Development Office) Anne-Marie Trevelyan informed UK Parliament on Tuesday.

The Paris Club is still waiting for China to commit to Sri Lanka’s debt overhaul before notifying their assurance that is needed to get IMF executive board approval EFF.

India has also extended financing assurances to the IMF to “clear the way for Sri Lanka to move forward.

Sri Lanka is confident of reaching a deal with all its international creditors and securing financial support from the International Monetary Fund (IMF).

State Minister of Finance Shehan Semasinghe said that the public have placed their trust on support from the IMF as it would create a foundation in finding solutions for the economic crisis in the country.

Semasinghe expressed these views at a discussion held today with a delegation led by the British High Commissioner to Sri Lanka Sarah Hulton.

The U.K has reiterated that as a member of the Paris Club, it stands ready to consider the necessary Financing Assurances to secure an Extended Financing Facility with the International Monetary Fund (IMF) in a timely manner to Sri Lanka.

“.Constructive engagement across creditors is vital to secure a prompt and comprehensive International Monetary Fund programme for Sri Lanka and ensure a sustainable economic recovery, UK Minister of State (Foreign, Commonwealth and Development Office) Anne-Marie Trevelyan added..

In the meeting with British High Commissioner to Sri Lanka Sarah Hulton. State Minister Semasinghe asserted that the entire government, including the President, was working to restore the economy.

The Paris Club major members of the informal group — comprising mostly rich, western bilateral creditors — favor giving financial assurances, but are waiting for Beijing to be on board to move ahead.

Since Sri Lanka defaulted in May, creditors have been going back and forth on the size of losses they are willing to accept and whether local debt should be included in the restructuring. A breakthrough came when India gave its debt assurances on Monday.

When reached for comment Thursday, a Paris Club spokesman referenced a September statement that said the group is willing to work with other creditors to provide the necessary financing assurances in a timely manner and ensure fair burden sharing.

“We felt strongly that Sri Lanka’s creditors must take proactive steps to facilitate its recovery,” Indian Foreign Minister Subhrahmanyam Jaishankar said in Colombo recently. “India decided not to wait on others but to do what we believe is right,” he said.

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