• The Steering Committee stresses the urgent need to implement the Joint Working Framework for restructuring Sri Lanka's $12.5 billion foreign debt by mid-September 2024 to align with IMF targets and ensure economic stability, amid ongoing legal challenges and the upcoming presidential election.

The Steering Committee of the Ad Hoc Group of International Bondholders has emphasized the urgent need to implement the Joint Working Framework for restructuring Sri Lanka’s international bonds by mid-September 2024. This framework aims to address Sri Lanka’s $12.5 billion foreign debt crisis by forgiving approximately $4 billion of outstanding debt, deferring near-term maturities, and providing over $9 billion in cash flow relief through the IMF program from 2023 to 2027. Prompt action is crucial to align with IMF debt sustainability targets and avoid further economic instability, particularly given the upcoming presidential election and potential litigation from other bondholders.

Since Sri Lanka suspended debt payments in April 2022, efforts to restructure its external debt have been ongoing, with significant progress made in negotiations by June 2024. The Steering Committee’s decision to file an amicus curiae brief reflects its commitment to expediting the restructuring process and addressing legal challenges. This intervention underscores the critical need for timely execution of the debt restructuring plan to restore economic stability and confidence among international investors, amid ongoing legal proceedings initiated by bondholders seeking full repayment.

International bondholders give SL mid-September ultimatum | Daily FT