Tetsushi Kajimoto
TOKYO (Reuters) – Crisis-ridden Sri Lanka should be able to wrap up newly launched debt restructuring talks by September or November at the latest, its president said on Thursday, It added that “significant” progress had been made in the talks.
Sri Lanka received a $2.9 billion bailout from the IMF in March but must put in place a debt restructuring framework by September to move ahead with the plan or risk derailing a slow economic recovery.
President Ranil Wickremesinghe made the comments at the start of a meeting with Japanese Prime Minister Fumio Kishida at his office in the capital Tokyo.
“We have made significant progress in terms of debt restructuring negotiations,” Wickremesinghe said.
“(We) should be able to wrap up by September or November at the latest.”
Kishida’s meeting with Sri Lankan Meeting for the first time since July, a Japanese official told Reuters new initiatives were unlikely but that the two sides would evaluate efforts to restructure debt.
Last month, France, India and Japan unveiled a common negotiating platform for bilateral creditor-coordinated debt restructuring.
Last April, the island nation defaulted on its foreign debt for the first time in its history as the worst financial crisis since British independence 1948 devastated its economy.
The International Monetary Fund this week called for a timely restructuring deal with the country’s creditors. The global bank said the macroeconomic situation in Sri Lanka was improving, although it had previously forecast a contraction this year.
Sri Lanka owes $7.1 billion to creditors, including $3 billion to China, $1.6 billion to China, $2.4 billion to India and $2.4 billion to the Paris Club of creditor nations.
