ECONOMYNEXT – Sri Lanka will make a virtual presentation to external creditors on September 23 updating them on on a deal agreed with the International Monetary Fund and recent economic developments, advisors Clifford Chance said.
Sri Lanka defaulted on its external debt on April 2022 after two years of money printed to suppress interest rates and target an output gap (stimulus) which triggered foreign reserves losses, downgrades, and bondholders were no longer willing to roll-over debt.
Sri Lanka in April allowed interest rates to go up after a failed float, eventually reducing domestic private credit and outflows. Sri Lanka has since raised some taxes and struck a staff level deal with the International Monetary Fund and is seeking to re-structure its debt.
Sri Lanka authorities will update creditors on more recent macro-economic developments, main objectives of the reform package with the IMF and the next steps of the debt re-structuring process on a virtual event.
“After the presentation, the authorities will also participate in an interactive session where participants will be given the opportunity to ask their questions,” the statement said.
“The presentation as well as a comprehensive Q&A document will be published on the Ministry’s website after the event.”
Creditors could register at – https://cliffordchance.eventogy.com/c/eventsrilanka/registration – and provide their names and contact details in order to receive dial-in details.
It will be held on Friday, September 23, 2022 at 5.30pm Sri Lanka time which 8:00am New York (EDT) / 1:00pm London (BST)
Sri Lanka has to get assurances from creditors about their willingness to re-structure debt for the International Monetary Fund to unlock credit from the agency and others and make the debt ‘sustainable’ according to an analytical methodology developed by the agency. (Colombo/Sept18/2022)