FDL/IEA Webinar | Zambia & Sri Lanka Debt Restructuring | Fri 17th March

Zambia is on the cusp of restructuring its external debt and has signed off on an IMF program, while in Sri Lanka, negotiations are ongoing. The goal of this session is to evaluate these arrangements from the debtor’s perspective. The focus will be on the shape of the debt restructuring deals, as well as the adjustment programs they support. By doing so, the discussion should bring together some of the hot issues in the field of development finance that tend to be treated separately: the nature of adjustment programs, IFIs’ loans to finance reforms, the possibility of a new growth path, and the type of debt workout needed to support such arrangements.

We are interested in three aspects:

• Adjustment program: does the package foster a new growth path? Is the program horizon long enough? is conditionality adapted to this goal?
• Debt restructuring: is the haircut proposed fair to all parties? Are the growth assumptions in the DSA realistic? Are there financing assurances by IFIs to finance this in the future? What are other sources of finance, domestic and external?
• Process: What has slowed down the negotiation process? What are the lessons for improving the Common Framework rules? How to involve China more centrally?