Sri Lanka Interim Debt Policy Overview
Financing assurances from bilateral creditors are required as a pre-requisite to the IMF
Board adoption of the Program
The IMF does not lend to countries whose debt is deemed unsustainable, requiring Sri Lanka to undertake an upfront comprehensive
debt treatment. In practice, this requires financing assurances to be given by the bilateral creditors, resulting in a sufficient level of
comfort to the IMF that bilateral creditors will support Sri Lanka's efforts to restore public debt sustainability
FOR PUBLIC CREDITORS
What are financing assurances?
Bilateral financing assurances are a commitment from
official bilateral creditors to grant Sri Lanka a debt
treatment compatible with the macroeconomic
framework and debt sustainability constraints
underpinning the contemplated IMF program.
They are the flagship step to the IMF being able to move
forward with a program for Sri Lanka
Aug. 2022
Sep.
Oct.
What does it mean for private creditors?
Private financing assurances are considered as obtained by
the IMF once Sri Lanka is making a "good faith" effort to
reach a collaborative agreement with its private creditors,
defined as:
•
Engaging in early dialogue
Sharing relevant information on a timely basis
Giving creditors the early opportunity to provide input
in the framework underpinning the debt restructuring
From SLA to mid-November 2022
• Window to obtain financing assurances from public and private
partners before IMF Board Approval, envisaged for mid-December
Nov.
Dec.
Jan. 2023
SLA
O
IMF Board Approval
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