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COLOMBO (Reuters) – Sri Lankan President Ranil Wickremesinghe said on Friday that Sri Lanka could emerge from bankruptcy by September, signaling a turnaround in the country as it emerges from its worst financial crisis in decades.
His office said in the statement that Wickremesinghe “expressed confidence that Sri Lanka would overcome the bankruptcy situation by September”.
Sri Lanka on Thursday launched a long-awaited domestic debt restructuring framework that seeks to rewrite part of the island nation’s $42 billion domestic debt.
The domestic debt plan is crucial for Sri Lanka, which defaulted on its external debt last May, to advance negotiations with bondholders and major bilateral creditors China, Japan and India.
“This is about the best we can achieve. Comes with the fact that our interest rates will come down. It’s a matter of months before they go down. Second, development assistance will start,” he said.
Sri Lanka’s economy is expected to contract by 2% in 2023, the government estimates, after contracting by 7.8% last year.
His office said in the statement that Wickremesinghe “expressed confidence that Sri Lanka would overcome the bankruptcy situation by September”.
Sri Lanka on Thursday launched a long-awaited domestic debt restructuring framework that seeks to rewrite part of the island nation’s $42 billion domestic debt.
The domestic debt plan is crucial for Sri Lanka, which defaulted on its external debt last May, to advance negotiations with bondholders and major bilateral creditors China, Japan and India.
“This is about the best we can achieve. Comes with the fact that our interest rates will come down. It’s a matter of months before they go down. Second, development assistance will start,” he said.
Sri Lanka’s economy is expected to contract by 2% in 2023, the government estimates, after contracting by 7.8% last year.
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