Public Finance Data and Analysis
Free and Open Access to
Sri Lanka is expecting a second round of talks with private investors "very soon" to restructure its sovereign bonds, according to State Minister for Finance Shehan Semasinghe, who did not specify a date. The country aims to complete its debt restructuring by June 2024 and proceed to the next round with the IMF board. "I cannot specify a timeline, but we are confident and optimistic that a second round of talks will commence very soon," Minister Semasinghe told reporters in Colombo. The bondholders have proposed restructuring bonds linked to dollar GDP growth and a $500 to $1,000 billion governance-linked bond, where coupons will fall if anti-corruption benchmarks and revenue targets in the IMF program are met, an initiative proposed by Colombo-based Verité Research at the first round of face-to-face talks.
Sri Lanka has about $12 billion of sovereign bonds to restructure, along with some missed coupons. While Minister Semasinghe refrained from commenting on individual proposals, he expressed confidence in reaching an amicable resolution in line with the principles of comparability and compliance with the IMF's debt sustainability assessment. "Bondholders are engaging very positively with Sri Lankan authorities as well as with the advisors. They also want to come to a resolution with Sri Lanka," he said. Additionally, Sri Lanka is working on finalizing memoranda of understanding with official creditors, Minister Semasinghe noted.
