April 16, Colombo (LNW): Sri Lanka’s debt restructuring process encounters hurdles in negotiations with private bondholders, while progressing smoothly with bilateral creditors, a senior official revealed yesterday (15).
Speaking to reporters, Chief of Staff of the President Sagala Ratnayake disclosed that discussions between the government and private bondholders have faced challenges due to differing proposals from both sides.
Despite two rounds of talks this year, disagreements persist on key aspects, narrowing down to two unresolved issues.
Ratnayake highlighted the International Monetary Fund’s (IMF) acknowledgment of the government’s proposals as compliant, contrasting with bondholders’ proposals deemed non-compliant.
However, he refrained from divulging specific details, citing confidentiality agreements.
Emphasising that negotiations with private bondholders form only one facet of the debt restructuring programme, Ratnayake underscored successful discussions with the Official Creditor Committee (OCC) and individual bilateral creditors like China.
The next step involves determining whether to pursue a single agreement with the OCC or negotiate individual agreements with member states.
Addressing sentiments expressed by the IMF, Ratnayake noted international donors’ satisfaction with Sri Lanka’s recent economic progress.
However, he clarified that the IMF remains committed to its programme guidelines despite positive evaluations.
