Sri Lanka’s debt restructuring process nearing completion

Sri Lanka’s debt restructuring process is nearing completion, with significant progress recorded across negotiations and implementation, according to the latest 6th Co-Chairs Progress Report released by the Global Sovereign Debt Roundtable (GSDR) recently.

The report states Sri Lanka’s debt restructuring is also nearly complete. Signature of bilateral agreements is well advanced while not yet fully finalised. Sri Lanka completed the 4th review of its Fund-supported program in July 2025 and received emergency financing under the IMF’s Rapid Financing Instrument in December 2025 in the aftermath of a cyclone. In response to the Government’s request, the World Bank made up to US$120 million in emergency support available by repurposing funds from ongoing projects to support recovery and help restore essential services and infrastructure. Authorities continue good-faith negotiations with the residual remaining commercial creditors.

The report states that most sovereign debt restructuring cases launched during 2021 and 2022 have now been largely completed, including Sri Lanka’s, which was carried out outside the G20 Common Framework. Sri Lanka’s restructuring now involves only a small number of residual commercial creditors, while the signing of bilateral agreements with official creditors is well advanced, though not yet fully finalised.

According to the GSDR, Sri Lanka successfully completed the fourth review of its IMF-supported
program me in July 2025. In December 2025, following a severe cyclone, the country also received emergency financing under the IMF’s Rapid Financing Instrument. In parallel, the World Bank provided up to US$120 million in emergency support by repurposing funds from ongoing projects to assist recovery efforts and restore essential services and infrastructure.

Source: Daily News