By Creditors have not yet agreed to Sri Lanka’s proposed loan repayment moratorium for its $12 billion bilateral debts until 2028. Negotiations are ongoing in London between the Sri Lankan government and bondholders, with attempts to find a middle ground still in progress. The government’s plan to defer payments for five years and then gradually repay the debts from 2028 to 2042 has not garnered consensus among creditors.
Despite efforts to reach an agreement, creditors remain unconvinced, highlighting the challenges in restructuring Sri Lanka’s debt amidst its economic crisis. The stance of creditors, including China and India, is crucial in determining the outcome of these negotiations.
China, in particular, has expressed willingness to continue negotiations but has not yet committed to the proposed repayment terms. With Sri Lanka’s external debt standing at $37.3 billion as of December 2023, finding a mutually acceptable solution remains a priority for all parties involved.
