Debt restructuring making progress in countries such as Sri Lanka – IMF

Debt restructuring is making progress in countries outside of the G20 common framework, such as Sri Lanka, the International Monetary Fund (IMF) says.

Addressing a press briefing on Thursday (July 13), the global lender’s Director of Strategic Communications, Julie Kozack said creditor coordination, too, has seen promising progress in these countries.

According to Kozack, the G20’s common framework has been delivering on debt restructuring cases as well, such as Chad, Ghana, and Zambia.

The IMF official acknowledged that the debt restructuring process needs to accelerate, be predictable and timely, adding that it also needs to provide ‘breathing space’ to debtor countries through debt suspension during negotiations.

“To help accelerate the debt restructuring process, Kozack said the IMF, along with the World Bank and India as G20 Chair, have initiated the Global Sovereign Debt Roundtable (GSDR).

“We had a first meeting in February that brought together, for the first time, traditional Paris Club creditors, non-Paris Club official creditors, such as China, India, and Saudi Arabia, as well as the private sector creditors, and, very importantly, debtor countries.”

Later, the meeting of the GSDR on April 22 resulted in some tangible progress as it aims to solve procedural and process-related issues, Kozack said, noting that the focus of GSDR on issues of process, not specific country cases. Specific country cases are being dealt with in the official creditor committees and in the negotiations between creditor and debtor, she explained.