Sri Lanka central bank says all creditors will be treated equally

Sri Lanka has already missed coupon repayments on some of its bonds and its bailout discussions with the IMF include a possible bridge loan, Nandalal Weerasinghe said. "All external creditors will be treated equally, whether they are (sovereign bond) holders, or China or Japan," he said, while warning creditors not to hold up the process.

All Sri Lanka's creditors will be treated equally in a planned restructuring of the country's debt, its central bank governor said on Friday, adding he expected progress in talks with the International Monetary Fund (IMF) in the next two months. Sri Lanka has already missed coupon repayments on some of its bonds and its bailout discussions with the IMF include a possible bridge loan, Nandalal Weerasinghe said.

"All external creditors will be treated equally, whether they are (sovereign bond) holders, or China or Japan," he said, while warning creditors not to hold up the process. "It is in the best interests of the creditors to cooperate and ensure debts are repaid as quickly as possible. If one party delays the process then they will get their payments delayed," Weerasinghe told a news briefing.

Sri Lanka's economy was hit hard by the pandemic and tax cuts by the populist government of President Gotabaya Rajapaksa. This has led to dwindling foreign currency reserves and shortages of fuel, food and medicines that have brought thousands onto the streets in sporadically violent protests.