Japan, UK closely coordinating Lanka’s debt restructuring plan | Daily News

Japan, UK closely coordinating Lanka’s debt restructuring plan

 Japanese Vice Finance Minister for International Affairs, Masato Kanda, has assured that Japan is closely coordinating with international organizations, such as the Paris Club and the International Monetary Fund (IMF) to ensure the participation of non-Paris Club members in Sri Lanka’s debt restructuring plan.

 Kanda stated that Japan was working hard to help Sri Lanka, which is suffering its deepest economic crisis in 70 years, by coordinating with the Paris Club of creditor nations and the IMF to ensure the participation of non-members, including China and India, in efforts to restructure the country’s debt.

“It is desirable to work with these non-Paris Club countries in the same way with the Common Framework,” he said, referring to a Group of 20 mechanism designed to provide a swift and comprehensive debt restructuring for nations facing difficulty meeting debt obligations after the COVID-19 shock to their economies.

“If this is realised, it would pave the way to carry out debt restructuring for other middle-income countries.”

Kanda said crisis-hit Sri Lanka was a key issue when it came to helping countries in debt but he was not sure when creditors aiming to extend it loans would meet.

Kanda, who will oversee deputy-level negotiations on economic policy among the Group of Seven (G7) nations this year, said in an interview that while sanctions against Russia and support for Ukraine will be at top priority at G7 finance track under Japan’s chair of the G7, global debt problems too, would be at the top of the G7 agenda.

Meanwhile the United Kingdom reiterated that it stands ready to consider necessary financing assurances to secure an Extended Financing Facility with the International Monetary Fund (IMF).

The UK is “ready to consider” financing assurances to Sri Lanka to secure a 2.9 billion US dollar extended fund facility (EFF) with the IMF, a UK official said.

Minister of State (Foreign, Commonwealth and Development Office) Anne-Marie Trevelyan told the British parliament on Tuesday January 24 that the UK is fully supportive of the proposed Coordination Platform between Sri Lanka’s Paris Club and non-Paris Club creditors, which the British government believes represents the most efficient way to restore debt sustainability in Sri Lanka.

“Constructive engagement across creditors is vital to secure a prompt and comprehensive International Monetary Fund programme for Sri Lanka and ensure a sustainable economic recovery. As a member of the Paris Club, the UK stands ready to consider the necessary Financing Assurances to secure an Extended Financing Facility with the IMF in a timely manner,” she said. (Agencies)




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