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Debt restructuring talks with Ad Hoc Group of Bondholders back on track, thanks to IMF

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From left: State Minister of Finance Shehan Semasinghe, President’s Chief of Staff Sagala Ratnayake, Secretary to the President Saman Ekanayake and Central Bank Governoor Dr. Nandalal Weerasinghe at a meeting with the IMF in March 2024 regarding its programme for Sri Lanka

By Sanath Nanayakkare

State Minister of Finance Shehan Semasinghe said on Saturday that the government is confident about the successful progression of debt restructuring talks with Sri Lanka’s private bondholders.The state minister’s comments on the matter followed recent reports which indicated that the IMF was currently assessing the latest proposal of the Ad Hoc Group of Bondholders whose earlier proposal was not accepted by the Sri Lankan authorities.

According to a report released by First Capital Research, Sri Lanka rejected international bondholders’ proposal on 15th April 2024 to restructure more than USD 12 billion in debt. Despite ‘constructive discussions’ with the Steering Committee members of the Ad Hoc Group of Bondholders and the two sides could not reach agreement on restructuring terms.

Some of the proposal’s ‘baseline’ assessments and a lack of a contingency option in the case of continued economic weakness were the two main reasons the deal was not agreed.

The negotiations primarily focused on the bondholders’ proposal, particularly concerning the introduction of a Macro-Linked Bond (MLB).

The March proposal suggested a 20% haircut on the nominal amount of existing bonds and the April proposal increased the haircut to 28% with no haircuts on Public Debt Interests (PDIs) in both March and April proposals.

However, significant disparities arose regarding baseline parameters, risk balance, trigger tests, and the allocation of additional value in various MLB scenarios. Following discussions, the bondholders revised their proposal in April 2024 to address some of the government’s concerns.

The IMF is currently assessing the latest proposal of the Ad Hoc Group of bondholders. Also, Sri Lanka has recommenced discussions with bondholders and is optimistic on achieving a resolution regarding debt restructuring by June 2024, the report by First Capital Research stated.

State Minister Semasinghe’s comments affirmed the above backdoor details when he said,” The Paris Club and our bilateral creditors have already given their consent to restructure our debt. Meanwhile, we are confident that we can arrive at an agreement with the Ad Hoc Private Bondholders group as the second round of discussions with them is about to commence. A problematic situation in this regard won’t arise because we are being transparent with all our debt holders in how we are proposing to restructure each category of debt. Also, this procedure is embedded with another key element. That is; the finally agreed upon debt restructuring terms won’t lead to the necessity of a second round of debt restructuring in the future. We treat this as very important.”

“It has only been 18 months since Sri Lanka has achieved a semblance of stability after the economy came to a grinding halt. The economic theory put forward by the Opposition boils down to one single fact. They want the government to print money and balance the budget deficit. Their views point to the requirement of changing laws of the new Central Bank Act and reverting to money printing. Sri Lanka has already experienced the consequences of money printing in the past two years with its debilitating impact on inflation, the value of Sri Lanka rupee, the exchange rate and so on. The new CBSL Act was introduced to avoid falling into that pitfall again. So, whatever arguments the Opposition would make, the government won’t agree to money printing under whatever circumstances,” he stated.

Meanwhile, Sri Lanka gross official reserves stood at US$ 5,438 mn as at end April 2024. This includes proceeds from the People’s Bank of China (PBOC) swap arrangement worth US$ 1,400 million, which is subject to conditionalities on usability. This would mean that the country now has usable foreign reserves of US$ 4,038. This number stood at a mere US$ 20 million in mid-April 2022.



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‘Green Chilies’ returns after seven years to reignite Sri Lanka’s advertising industry spirit

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After a seven-year hiatus, one of Sri Lanka’s most loved advertising industry gatherings is making a much-anticipated return. Green Chilies 2026, the iconic festival that once defined the fun, camaraderie and creative spirit of Sri Lanka’s advertising fraternity, returns on 4th June 2026 at Rise Up, Colombo 03, bringing together professionals from across agencies, media, digital, production and marketing for an evening of celebration, entertainment, and industry camaraderie.

Originally launched in 2011, Green Chilies was conceived as a platform to celebrate Sri Lanka’s Young Lions winners as they embarked on their journey to represent the country at the prestigious Cannes Lions International Festival of Creativity, while also creating a unique opportunity for the industry to come together outside boardrooms and deadlines.

This year’s revival comes at an especially meaningful time, as an entire new generation of industry professionals have entered the business without ever experiencing the culture and energy that made Green Chilies such a defining event. Some key highlights will be the recognition of the winners of the young Lions competition and the much-loved return of The Agency Idol, the wildly entertaining competition where agencies battle it out on stage in a spirited showcase of talent, humour, and creativity, bringing back one of the event’s most iconic traditions.

Speaking about the return of the festival, Ranil de Silva, Founder of Green Chilies and of Metal Factor, said: “When we first launched Green Chilies, the idea was simple. It was to celebrate our Young Lions and create something that brought the industry together as one community. Over the years it became far more than an event, it became part of our industry culture. Seeing it return after seven years is very special, particularly because so many young professionals will now get to experience the spirit that made this industry such a fun and inspiring place to be.”

Green Chilies 2026 is organized by Metal Factor and supported by the 4A’s Sri Lanka.

Event Details:

Venue: Rise Up, Alwis Place, Colombo 03

Date: Thursday, 4th June 2026

Time: From 6.30 PM onwards

Contact : Shelley +94 77 342 3123

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JKH posts 75% EBITDA growth to Rs.80.01 billion as recent investments begin to contribute

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Krishan Balendra, Chairperson and CEO

John Keells Holdings PLC (JKH) reported a strong financial performance for FY2025/26, with Group EBITDA increasing 75% to Rs.80.01 billion, reflecting the contribution of investments made over the past several years and the continued performance of the Group’s established businesses.

Group recurring EBITDA increased 71% to Rs.78.05 billion, compared to Rs.45.69 billion in the previous year, driven primarily by Retail, Transportation and Leisure. Recurring profit before tax rose 143% to Rs.35.72 billion, while recurring profit attributable to equity holders of the parent increased 155% to Rs.13.24 billion.

The year also marked the culmination of the largest investment phase in the Group’s history, with the operationalisation of key investments signalling a shift in the capital cycle from development to contribution. Overall funding requirements reduced materially in line with expectations, while net debt to EBITDA stood at approximately 2 times and net debt to equity at approximately 31%.

City of Dreams Sri Lanka recorded positive EBITDA for the full year, following the completion and launch of the remaining components of the integrated resort. Cinnamon Life’s conference and event spaces attracted interest from local and international organisers, while casino operations showed an encouraging pick-up from the fourth quarter onwards.

Colombo West International Terminal, the project company of WCT-1, recorded strong throughput growth during the year, supported by an improving volume mix. The business delivered a positive profit after tax ahead of expectations, despite recognising depreciation relating to phase 1, and has reached full utilisation of phase 1 capacity based on its latest monthly run-rate.

John Keells CG Auto recorded an exceptional year, supported in part by pent-up demand and the brand positioning and vehicle range of BYD.

The Supermarket business recorded approximately 14% growth in same store sales, driven primarily by a 14.3% increase in footfall. The Beverages and Confectionery businesses recorded strong volume growth, with Beverages benefiting from higher margins, while Confectionery margins were impacted by higher raw material costs and expenses linked to new product introductions.

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RCSS receives Chatham House Senior Research Fellow for discussion on South Asian Regionalism

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Dr. Chietigj Bajpaee, Senior Research Fellow for South Asia, Asia-Pacific Programme at Chatham House, visited the Regional Centre for Strategic Studies on 26 May 2026 and met with the ED/RCSS, Ambassador (Retd.) Ravinatha Aryasinha, and researchers at the Centre. The discussion focused on Regionalism in South Asia and evolving geopolitical developments in the region.

Ambassador Aryasinha detailed the recent and ongoing initiatives undertaken by the RCSS and its wide Alumni Network spread throughout the region in strengthening South Asian solidarity. Dr. Bajpaee impressed on the need to consider alternative forms of regional cooperation in South Asia given the absence of India–Pakistan normalization, resulting in the stagnation of SAARC and the growing pull towards external regional frameworks such as the Regional Comprehensive Economic Partnership (RCEP). The two parties explored possibilities beyond state-led regionalism, including stronger networks among civil society, think tanks, diaspora groups, and business communities, as well as thematic “mini-lateral” cooperation on issues such as climate adaptation and maritime governance.

Ms. Chamika Wijesuriya, Ms. Thedini Herath, and Shayan Peris, Research/Programme Officers at RCSS, were associated with the discussion.

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