Sri Lanka says it has reached an agreement with China’s EXIM Bank on debt, clearing IMF funding snag

By KRISHAN FRANCIS
Associated Press

COLOMBO, Sri Lanka (AP) — Sri Lanka says that it has reached an agreement on key terms and principles on its debt restructuring with the Exim Bank of China. That clears a key step in unlocking a second instalment of a $2.9 billion package from the International Monetary Fund aimed at rescuing the island nation from a dire economic crisis. The finance ministry said Thursday that the agreement covers $4.2 billion in outstanding debt and it will provide the necessary fiscal space for Sri Lanka to implement its economic reform agenda. Authorities hope this will anchor their debt restructuring program and facilitate approval of the next tranche of IMF financing of about US$334 million.