Leika Kihara and Jorgelina do Rosario report
WASHINGTON (Reuters) – Japan, India and France on Thursday announced a common platform for bilateral creditor talks to coordinate a debt restructuring in Sri Lanka, They hope the move will serve as a model for addressing the debt woes of middle-income economies.
However, it remains uncertain whether Sri Lanka’s largest bilateral creditor – China – will join the initiative launched by Japan, this year’s G7 chair, with the aim of kick-starting a series of negotiations among Sri Lanka’s creditors. Meeting.
Historic results,” Japanese Finance Minister Shunichi Suzuki told a briefing. French Finance Director-General Emmanuel Moulin told a briefing that the group was ready to “as soon as possible” First round of talks held.
Sri Lanka’s central bank governor told Reuters earlier this week that having a single platform for talks would be a welcome move that would make discussions and information sharing easier.
“I hope the creation of this platform will become a model case,” said Suzuki, of debt restructuring in middle-income countries.
Japan’s chief currency diplomat Masato Kanda told reporters that the group has sent invitations to all bilateral creditors in Sri Lanka, including China, hoping to hold the first round of talks as soon as possible.
This group has 22 100 The island nation of 10,000 people won a $2.9 billion package from the International Monetary Fund last month to tackle its massive debt load. But middle-income economies cannot deal with the common debt under the G22 framework application relief, which is only for low-income countries.
Putting the onus on major economies to come up with alternatives, thus creating new platforms.
According to official government figures , Sri Lanka owes $7.1 billion to bilateral creditors, of which $3 billion is owed to China, followed by $2.4 billion to the Paris Club and $1.6 billion to India.
Government also owes Need to renegotiate more than $120 billion euro bond debt with overseas private creditors, and $2.7 billion in other business loans.
Sri Lanka launched this month Negotiations to restructure some domestic debt, aiming to close deal by May.