Sri Lanka to hire global law firm to aid debt restructuring

Sri Lanka will hire a global law firm to provide technical assistance on debt restructuring ahead of talks with the International Monetary Fund (IMF) on the country's economic crisis, a top official said on Tuesday.

The island's currency reserves have slumped 70% in the last two years to $2.31 billion and it has to repay about $4 billion in debt in the remainder of this year.

The drain of its dollars has left Sri Lanka struggling to pay for critical imports, including food, fuel and medicine. The government ordered the military to post soldiers at hundreds of gas stations on Tuesday to help distribute fuel.

Sri Lanka's cabinet made the decision to appoint a technical adviser on Monday, spokesman Ramesh Pathirana told reporters.

He said the central bank governor, foreign and justice ministers would oversee the selection process.

Sri Lanka's finance minister is due to head to Washington next month for the IMF talks.

Features

A Time for Turnarounds

by Sachin Dave | 10 Jan 2023

With cheap capital, low interest rates, and government support all coming to an end, insolvency cases are expected to increase in the next few months. As the restructuring process offers Asian corporates the ideal outcomes for creditors and debtors, lawyers in the space expect to have their hands full for some time.