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659193
Wed, 05/10/2023 - 02:27
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http://m.oananews.org//node/659193
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Japan, Others Hold 1st Meeting of Sri Lanka Creditors
Tokyo, May 9 (Jiji Press)--Japan and other creditors to Sri Lanka on Tuesday held their first meeting on debt restructuring for the South Asian country effectively in default.
The online meeting, co-chaired by Japan, India, France and others, brought together 26 countries including 19 creditors. China, the biggest creditor to Sri Lanka, was present as an observer.
The group of Sri Lanka creditors, established last month, is a multinational framework involving emerging economies, whose influence over the global economy is increasing.
China has shown reluctance to disclose details of its loans to Sri Lanka, such as amounts and lending terms. The focus for now will be whether China will join the framework.
A broad agreement has been obtained from China over the framework, Japanese Vice Finance Minister for International Affairs Masato Kanda told reporters after Tuesday's meeting.
Sri Lankan debt restructuring "is an urgent matter," he said. "We'll negotiate, aiming to strike an agreement early."
In March, the International Monetary Fund approved a 3.1-billion-dollar bailout for Sri Lanka over four years.
The measure will help secure the country's financial stability for now. But the recovery is unlikely to be sustainable without fair debt restructuring based on an agreement among all creditors.
Debt restructuring for low- and middle-income countries have traditionally been led by the Paris club of major creditors including Japan, the United States and European countries.
In recent years, however, nonmember nations such as China and India have been boosting their presence as creditors. How to secure their participation in debt restructuring talks is becoming a key issue.
The new framework is a "historic achievement," Kanda said.
Regarding debts incurred by low- and middle-income countries, the World Bank is set to disclose data during the three-day meeting of the Group of Seven finance ministers and central bank leaders in Niigata, central Japan, from Thursday.
The G-7 major powers are expected to use the data to discuss how to prevent sovereign debt crises.
END
