Sri Lanka now plans to finalise debt restructuring after September

• President says main focus is on rolling out delayed structural reforms

Sri Lanka expects to finalise the debt restructuring talks after September this year, according to President Ranil Wickremesinghe, who said the primary focus would be on rolling out long-delayed structural reforms to return to the growth trajectory in 2024 with enhanced long-term prospects.

 “I plan to finalise the debt restructuring after September. As I move forward, I will be working on Sri Lanka’s debt restructuring strategy with the parliament. However, my main focus is on completing the necessary structural reforms. I aim to promptly liberalise the economy and attract more investments to Sri Lanka. 

In the long run, it is crucial to have investments that will improve the balance of trade in our favour. So, why should this process take so much time? Nonetheless, I am confident that by 2024, we will have much greater control over the situation,” Wickremesinghe said.

He shared these remarks taking part in the 40th anniversary event of the International Democrat Union (IDU) in London held this week and joining the forum with former Canadian Prime Minister (Conservative Party) Chairman of the IDU, Stephen Harper.

Earlier, the government was aiming to complete the debt restructuring negotiations by September coinciding with the first review of the US$ 3 billion IMF programme. The government is yet to unveil the debt restructuring framework, which was originally scheduled for mid-May. While debt restructuring remains a key priority, President Wickremesinghe stressed that the primary focus lies in completing vital structural reforms which are aimed accelerating economic liberalisation and attracting increased flow of investments. 

The on-going reforms are intended to bolster Sri Lanka’s financial prospects and to strike a more favourable balance of trade in the long term, he said.

Although, the current bilateral debt restructuring negotiation arrangements with China and other creditors seem to be progressing for Sri Lanka, he warned that it may not work for other debtor nations as a replicable model.

“… in Sri Lanka, we proposed the Common Platform and suggested India join the platform while China attended as an observer. They expressed their willingness to engage in bilateral discussions with us, but their primary focus seems to be on bilateral discussions with the International Monetary Fund (IMF). The IMF ensures all parties are informed and involved. Currently, we are working on the platform for creditors and engaging with China, but I cannot predict how this will work out with other debtor nations,” he added.

Amid questions regarding the duration of the process, the President expressed confidence that substantial headway will be achieved by 2024.