Sri Lanka has finally secured IMF approval for a $3bn loan program, which will serve to bolster an economy grappling with soaring prices and dwindling foreign reserves. The 48-month loan program, which was widely expected, will also be crucial in the restructuring of its $56bn external debt. All eyes now turn to the debt talks which may drag on as “creditors debate whether to include local-currency sovereign borrowing in the restructuring”, according to Fitch Ratings. Sri Lanka’s president, Ranil Wickremesinghe said, “We are committed to full transparency in our efforts to achieve sustainable levels of debt and our reform agenda. The IMF program is critical to achieving this vision.”
Sri Lanka’s dollar bonds have been on the rise since hitting lows of ~22 cents in November last year to about 36 cents currently. It’s 6.2% 2027s are up 0.1 point this morning to 36.1 cents on the dollar.
For more details, click here
