INSUBCONTINENT EXCLUSIVE:
the IMF for the bankrupt country.On September 1, the International Monetary Fund (IMF) announced that it will provide Sri Lanka with a loan
of about USD 2.9 billion over a four-year period to help the island nation overcome the unprecedented economic turmoil.The bailout package
the creditors, the government on Friday said that assurances from bilateral creditors are required as a prerequisite to the IMF board
adoption of the programme
It is expected to materialise by mid-December.The IMF does not lend to countries whose debt is deemed unsustainable, requiring Sri Lanka to
grant Sri Lanka a debt treatment compatible with the macroeconomic framework and debt sustainability to underpin the contemplated IMF
programme.Explaining it further the government held that private financing assurances are considered as obtained by the IMF once Sri Lanka
provide input in the framework underpinning the debt restructuring.The severe economic downturn, weak Sri Lanka revenues, rising health
expenditure and energy needs led to a worsening of the fiscal situation
While the decline in growth partly led to shrinking revenues, Sri Lanka had to increase spending to safeguard its population from a
double-pronged health and energy crisis, primary balance, revenues and expenditures.In mid-April, Sri Lanka declared its international debt
default due to the forex crisis
The country owes USD 51 billion in foreign debt, of which USD 28 billion must be paid by 2027.It was said that international bondholders
have formed a creditor committee comprising close to 100 members
The group represents more than 55 per cent of the international bondholders.A group of local private banks holding International Sovereign
Bonds have also formed a group.The presentation said the effective way to obtain financing assurances quickly is the creation of a bilateral
creditor coordination platform
This would enable them to deliver financing assurances and validate the IMF programme through a fast-track the solution, allowing Sri
The impact has been disproportionately borne by the poor and vulnerable, the IMF noted.Source: PTI--Agencies
This article first appeared/also appeared in https://adaderana.lk
