Paris Club Creditors provide financing assurances to support the IMF approval of an EFF for SL

• Published date: 07 February 2023
• Publication title: Daily Mirror

Paris Club members held a meeting on January 25, 2023, in the presence of representatives from Hungary, Saudi Arabia, the Kuwait Fund for Arab Economic Development and India, as well as from the International Monetary Fund and the World Bank, to provide financing assurances to support the approval by the IMF Executive Board of the envisaged IMF program for Sri Lanka, which would allow restoring the country macroeconomic stability.

They examined the macroeconomic and financial situation of Sri Lanka, including its long-term debt sustainability, and the need for a debt treatment by all bilateral creditorsto both fill the financing gap and to ensure Sri Lanka's debt sustainability in line with the proposed Extended Fund Facility.

We acknowledge that Sri Lanka authorities had the opportunity to present their economic and financial situation to its creditors, which underscored its need for debt treatment from all creditors. They also presented their reform program that will be supported by an IMF arrangement requiring a debt treatment to restore debt sustainability, as well as the prior actions already implemented.

Paris Club members as well as Hungary, Saudi Arabia and India continue to look forward to working together along with all bilateral creditors and to engage with other key stakeholders in order to proceed with a comparable debt restructuring as soon as possible.

Shortly after the conclusion of a staff-level agreement between the Sri Lankan authorities and IMF staff on September 1, 2022, on a 48-month Extended Fund Facility arrangement, the Paris Club publicly stated its readiness to provide the necessary financing assurances in a timely manner and in coordination with other bilateral official creditors. To this end, the Paris Club has been engaging proactively with Sri Lankan authorities, the IMF, and Sri Lanka's other official bilateral creditors, including by sharing its technical analysis in order to enhance the bilateral official creditors' collective understanding of the need for debt treatment.

To support the implementation of the envisaged IMF supported program and the Sri Lankan authorities' efforts with...