The Ministry of Finance has declared a significant achievement, having reached an agreement in principle on the key principles and indicative terms of a debt treatment with the Export-Import Bank of China, known as China Exim Bank.

This agreement in principle encompasses approximately USD 4.2 billion of outstanding debt, representing a substantial milestone towards restoring Sri Lanka's long-term debt sustainability and facilitating a prompt economic recovery.

The indicative terms outlined in this agreement will create essential fiscal space for Sri Lanka to execute its ambitious reform agenda. The government of Sri Lanka highly appreciates the engagement and ongoing support from China Exim Bank, which exemplifies mutual commitment aligned with the goal of reinstating public debt sustainability, consistent with the IMF-supported program.

This achievement positions Sri Lankan authorities to strengthen their engagement with the Official Creditor Committee and commercial creditors, including bondholders. It is anticipated to expedite the approval of the IMF Executive Board for the first review of the IMF-supported program in the coming weeks, making way for the disbursement of approximately USD 334 million in IMF financing.

The Secretary to the Treasury, Mr. K. M. Mahinda Siriwardana, emphasized the significance of this landmark agreement in principle, marking a substantial step in Sri Lanka's ongoing endeavors to reinvigorate its economic recovery.