External advisory firm begins talks with India, China, and Japan to restructure Lanka’s debt

By Rathindra Kuruwita

Lazard, the external debt advisory firm selected by Sri Lanka to help restructure debt, had commenced discussions with India, China and Japan, Minister Dr. Ramesh Pathirana said yesterday at the post-Cabinet press briefing.

The Cabinet spokesperson said that Lazard had been hired to hold discussions with bilateral and other debt holders and that they have already started discussions.

“These discussions are ongoing, and I hope we will be able to come to a consensus soon,” Dr. Pathirana said.

Debt restructuring is important for Sri Lanka to receive IMF aid, as well.

“Debt relief from Sri Lanka’s creditors, and additional financing from multilateral partners, will be required to help ensure debt sustainability and close financing gaps. Financing assurances to restore debt sustainability from Sri Lanka’s official creditors and making a good faith effort to reach a collaborative agreement with private creditors are crucial before the IMF can provide financial support to Sri Lanka,” the IMF said in a statement announcing that it had reached a staff-level agreement with Sri Lanka, earlier this month.