{"id":83199,"date":"2023-11-29T00:45:38","date_gmt":"2023-11-29T04:45:38","guid":{"rendered":"https:\/\/dbsjeyaraj.com\/dbsj\/?p=83199"},"modified":"2023-11-29T20:48:12","modified_gmt":"2023-11-30T00:48:12","slug":"sri-lanka-has-reached-an-agreement-in-principle-with-india-and-the-paris-club-group-of-creditors-including-japan-on-a-debt-treatment-plan-lenders-expect-transpar","status":"publish","type":"post","link":"https:\/\/dbsjeyaraj.com\/dbsj\/?p=83199","title":{"rendered":"Sri Lanka has reached an \u201cagreement in principle\u201d with India and the Paris Club group of creditors including Japan, on a debt treatment plan; Lenders \u2018expect\u2019 transparency from \u2018other bilateral creditors\u2019 alluding to China"},"content":{"rendered":"


\nBy\u2019<\/p>\n

Meera Srinivasan<\/strong><\/p>\n

Sri Lanka has reached an \u201cagreement in principle\u201d with India and the Paris Club group of creditors including Japan, on a debt treatment plan that will help the crisis-hit island nation tap the next tranche of the International Monetary Fund\u2019s nearly-$3 billion recovery package. <\/p>\n

\u201cThe OCC [Official Creditor Committee] and Sri Lanka agreed on the main parameters of a debt treatment consistent with those of the Extended Fund Facility (EFF) arrangement between Sri Lanka and the IMF,\u201d the Paris Club said in a statement on Wednesday. While the statement did not spell out the parameters, the OCC said it \u201cstands ready and looks forward to formalising\u201d the agreement in the coming weeks in a Memorandum of Understanding with Sri Lanka.<\/p>\n

At the height of last year\u2019s crippling economic crisis, Sri Lanka decided to default on its nearly $51 billion foreign debt. A comprehensive restructuring of loans became necessary to begin an economic recovery programme backed by the IMF. Major lenders formed the OCC in May 2023 in response to Colombo\u2019s request for debt treatment. It is co-chaired by India, <\/p>\n

<\/p>\n

Japan, and France, as chair of the Paris Club. The Committee has held several discussions with Sri Lankan authorities over the last few months, evaluating possible options in recasting Colombo\u2019s outstanding debt, such as altering the interest payments or the terms of the loans. China, Sri Lanka\u2019s largest bilateral creditor, has opted to stay out of the platform, but has attended the meetings as an observer.<\/p>\n

Japan and India, Sri Lanka\u2019s other two major lenders, have repeatedly emphasised the need for creditor parity and transparency. In an apparent reference to China, the OCC on Wednesday noted that it expects \u201cother bilateral creditors\u201d to consent to \u201csharing, in a transparent manner, the information necessary for the OCC to evaluate comparability of treatment regarding their own bilateral agreement.\u201d<\/p>\n

The OCC further asked Sri Lanka to continue to engage with its private creditors \u2014 who hold the largest chunk of the island\u2019s foreign debt \u2014 and swiftly firm up \u201can agreement on terms at least as favourable as the terms offered by the OCC\u201d.<\/p>\n

The IMF, on reaching a staff-level agreement with Sri Lanka October 19, 2023, after its first review of the External Fund Facility, said it had taken note of \u201ca tentative agreement\u201d between Sri Lanka and the Export-Import Bank of China, and that it looked forward to \u201canalyzing the details\u201d. Securing an agreement with official creditors on a debt treatment plan consistent with the Fund\u2019s debt targets was \u201cthe critical next step\u201d, the Fund said, indicating that the next instalment of the IMF package was contingent on it.
\nChina has assured Sri Lanka of cooperation in y:the debt restructuring process and Sri Lanka has, in turn, assured other creditors of China\u2019s transparent participation, but the specifics of the possible debt treatment plan are awaited.<\/p>\n

Courtesy: The Hindu<\/em><\/p>\n

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By\u2019 Meera Srinivasan Sri Lanka has reached an \u201cagreement in principle\u201d with India and the Paris Club group of creditors including Japan, on a debt treatment plan that will help the crisis-hit island nation tap the next tranche of the International Monetary Fund\u2019s nearly-$3 billion recovery package. \u201cThe OCC [Official Creditor Committee] and Sri Lanka …<\/p>\n

Continue reading ‘Sri Lanka has reached an \u201cagreement in principle\u201d with India and the Paris Club group of creditors including Japan, on a debt treatment plan; Lenders \u2018expect\u2019 transparency from \u2018other bilateral creditors\u2019 alluding to China’ »<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[12],"tags":[],"_links":{"self":[{"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/posts\/83199"}],"collection":[{"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=83199"}],"version-history":[{"count":1,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/posts\/83199\/revisions"}],"predecessor-version":[{"id":83200,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/posts\/83199\/revisions\/83200"}],"wp:attachment":[{"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=83199"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=83199"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=83199"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}