# Sri Lanka to unveil debt restructuring plan to creditors
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-09-23
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Sri Lanka to Start Talks with Creditors on Debt
Meta Description: Learn about how Sri Lankan authorities are initiating talks to restructure its debt, crucial for securing vital loans and overcoming economic crisis.
URL: https://financedigest.com/sri-lanka-to-unveil-debt-restructuring-plan-to-creditorshtml

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By Uditha Jayasinghe

COLOMBO (Reuters) – Sri Lankan authorities will formally hold talks with international creditors on Friday to start the process of restructuring billions of dollars of its debt and share plans to tackle the island’s worst economic crisis in more than seven decades.

The success of the restructuring process is critical for the nation of 22 million to secure final approval for a $2.9 billion loan from the International Monetary Fund and subsequent financing from other global agencies.

The money will help the island nation overcome an acute [shortage of food](https://www.financedigest.com/we-are-going-to-die-food-shortages-add-to-sri-lankas-woes.html "‘We are going to die’: Food shortages add to Sri Lanka’s woes") and fuel that sparked sweeping street protests for months this year and led to the ouster of then-President Gotabaya Rajapaksa.

Sri Lanka’s finance and other [officials plan](https://www.financedigest.com/australias-nuclear-submarine-plan-to-cost-up-to-245-billion-by-2055-defence-official.html "Australia’s nuclear submarine plan to cost up to 5 billion by 2055 -defence official") to hold a virtual interactive session to share the objectives of its loan package agreed with the IMF on Sept. 1 and the next [steps of the debt restructuring](https://www.financedigest.com/sovereign-debtors-creditors-agree-on-steps-to-jumpstart-debt-restructurings.html "Sovereign debtors, creditors agree on steps to jumpstart debt restructurings") process.

Its presentation to the creditors will be made [public after the event](https://www.financedigest.com/the-gibraltar-blockchain-exchange-announces-public-token-sale-event-to-create-world-leading-licensing-and-regulation-standards-in-the-industry.html "The Gibraltar Blockchain Exchange Announces Public Token Sale Event To Create World Leading Licensing and Regulation Standards In The Industry"). The government has already held preliminary restructuring talks with neighbour India and diplomats based in Colombo.

There was a very [positive response](https://www.financedigest.com/lumen-registers-increased-views-and-more-positive-response-to-ads-using-seenthis-technology.html "Lumen registers increased views and more positive response to Ads using SeenThis Technology") from the meeting with ambassadors chaired by the president on Thursday,” an official at the president’s office said, speaking on condition of anonymity.

[“Sri Lanka](https://www.financedigest.com/doctors-bankers-protest-impossible-situation-as-sri-lanka-runs-out-of-fuel.html "Doctors, bankers protest ‘impossible situation’ as Sri Lanka runs out of fuel") is focused on trying to get the IMF deal finalised by December or early next year.

Sri Lanka’s foreign currency debt was $47.3 billion as of end-2021 and local-currency debt at $53.6 billion, according to an [update from the Ministry of Finance](https://www.financedigest.com/mifid-ii-how-regulation-updates-will-change-finance-communications.html "MiFID II: How Regulation Updates will Change Finance Communications") in August. China, Japan and India are its [top bilateral creditors](https://www.financedigest.com/collapsed-ftx-owes-nearly-3-1-billion-to-top-50-creditors.html "Collapsed FTX owes nearly .1 billion to top 50 creditors").

The foreign currency [debt includes $13 billion in international sovereign](https://www.financedigest.com/analysis-no-china-no-deal-bid-to-break-sovereign-debt-logjams-gets-weary-thumbs-up.html "Analysis-No China, no deal: Bid to break sovereign debt logjams gets weary thumbs up") bonds held largely by private creditors, such as asset managers BlackRock and Ashmore.

(Writing by Krishna N. Das; Editing by Raju Gopalakrishnan)


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