Sri Lanka's Debt Deal: A New Dawn in Economic Resurgence

Sri Lanka has finalized debt restructuring agreements with key bilateral lenders, including China and India. President Ranil Wickremesinghe announced this as a pivotal milestone to enhance international trust and economic recovery. These agreements will defer all bilateral loan payments until 2028 and offer extended repayment terms until 2043.

Sri Lankan President Ranil Wickremesinghe announced a breakthrough in debt restructuring agreements with major bilateral lenders, including China and India, during a televised address on Wednesday. This development marks a significant milestone, poised to enhance international trust in Sri Lanka's economic stability.

Wickremesinghe, who also serves as the finance minister, outlined that the agreements will defer all bilateral loan instalments until 2028, with extended repayment terms until 2043. These deals, finalized in Paris and Beijing, signify a vital step toward pulling the island nation out of its economic quagmire since its first-ever sovereign default in 2022.

Addressing the nation, Wickremesinghe emphasized that the new agreements would drastically reduce debt payments as a percentage of GDP, from 9.2% in 2022 to less than 4.5% between 2027 and 2032. The president extended his gratitude to the creditors, particularly China, the Exim Bank of China, India, Japan, and France, for their unwavering support and leadership in this process.

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