Business
Debt restructuring talks with Ad Hoc Group of Bondholders back on track, thanks to IMF
By Sanath Nanayakkare
State Minister of Finance Shehan Semasinghe said on Saturday that the government is confident about the successful progression of debt restructuring talks with Sri Lanka’s private bondholders.The state minister’s comments on the matter followed recent reports which indicated that the IMF was currently assessing the latest proposal of the Ad Hoc Group of Bondholders whose earlier proposal was not accepted by the Sri Lankan authorities.
According to a report released by First Capital Research, Sri Lanka rejected international bondholders’ proposal on 15th April 2024 to restructure more than USD 12 billion in debt. Despite ‘constructive discussions’ with the Steering Committee members of the Ad Hoc Group of Bondholders and the two sides could not reach agreement on restructuring terms.
Some of the proposal’s ‘baseline’ assessments and a lack of a contingency option in the case of continued economic weakness were the two main reasons the deal was not agreed.
The negotiations primarily focused on the bondholders’ proposal, particularly concerning the introduction of a Macro-Linked Bond (MLB).
The March proposal suggested a 20% haircut on the nominal amount of existing bonds and the April proposal increased the haircut to 28% with no haircuts on Public Debt Interests (PDIs) in both March and April proposals.
However, significant disparities arose regarding baseline parameters, risk balance, trigger tests, and the allocation of additional value in various MLB scenarios. Following discussions, the bondholders revised their proposal in April 2024 to address some of the government’s concerns.
The IMF is currently assessing the latest proposal of the Ad Hoc Group of bondholders. Also, Sri Lanka has recommenced discussions with bondholders and is optimistic on achieving a resolution regarding debt restructuring by June 2024, the report by First Capital Research stated.
State Minister Semasinghe’s comments affirmed the above backdoor details when he said,” The Paris Club and our bilateral creditors have already given their consent to restructure our debt. Meanwhile, we are confident that we can arrive at an agreement with the Ad Hoc Private Bondholders group as the second round of discussions with them is about to commence. A problematic situation in this regard won’t arise because we are being transparent with all our debt holders in how we are proposing to restructure each category of debt. Also, this procedure is embedded with another key element. That is; the finally agreed upon debt restructuring terms won’t lead to the necessity of a second round of debt restructuring in the future. We treat this as very important.”
“It has only been 18 months since Sri Lanka has achieved a semblance of stability after the economy came to a grinding halt. The economic theory put forward by the Opposition boils down to one single fact. They want the government to print money and balance the budget deficit. Their views point to the requirement of changing laws of the new Central Bank Act and reverting to money printing. Sri Lanka has already experienced the consequences of money printing in the past two years with its debilitating impact on inflation, the value of Sri Lanka rupee, the exchange rate and so on. The new CBSL Act was introduced to avoid falling into that pitfall again. So, whatever arguments the Opposition would make, the government won’t agree to money printing under whatever circumstances,” he stated.
Meanwhile, Sri Lanka gross official reserves stood at US$ 5,438 mn as at end April 2024. This includes proceeds from the People’s Bank of China (PBOC) swap arrangement worth US$ 1,400 million, which is subject to conditionalities on usability. This would mean that the country now has usable foreign reserves of US$ 4,038. This number stood at a mere US$ 20 million in mid-April 2022.
The Delegation of German Industry and Commerce in Sri Lanka (AHK Sri Lanka) proudly facilitated the first-ever Sri Lankan delegation’s participation at Drupa 2024, the world’s largest trade fair for the printing industry and technology. Held after an eight-year hiatus, Drupa 2024 was a landmark event, marking significant advancements and opportunities in the global printing industry.
AHK Sri Lanka played a pivotal role in organising and supporting the delegation, which comprised 17 members from the Sri Lanka Association for Printers (SLAP), representing eight companies from the commercial, newspaper, stationery printing, and packaging industries. This pioneering effort by AHK Sri Lanka not only showcased the diverse capabilities of Sri Lanka’s printing sector but also facilitated vital bilateral discussions with key stakeholders from the German printing industry.
Business
Unveiling Ayugiri: Browns Hotels & Resorts sets the stage for a new era in luxury Ayurveda Wellness
In a captivating reimagining of luxury wellness tourism, Browns Hotels & Resorts proudly unveiled the exquisite Ayugiri Ayurveda Wellness Resort Sigiriya. This momentous occasion, celebrated amidst a vibrant and serene grand opening on the 6th of June, heralds a new chapter in the Ayurveda wellness tourism landscape in Sri Lanka. Nestled amidst 54 acres of unspoiled natural splendour, Ayugiri features 22 exclusive suites and stands out as the only luxury Ayurveda wellness resort in the country offering plunge pools in every room, rendering it truly one-of-a-kind.
The grand opening of Ayugiri Ayurveda Wellness Resort was an enchanting event, where guests were captivated by the melodies of flutists and violinists resonating through Sigiriya’s lush landscapes. As traditional drummers and dancers infused the air with vibrant energy, Browns Hotels & Resorts’ CEO, Eksath Wijeratne, Kotaro Katsuki, Acting Ambassador for the Embassy of Japan and General Manager, Buwaneka Bandara, unveiled the resort’s new logo, marking a significant moment witnessed by distinguished guests from the French Embassy, Ayurveda and wellness enthusiasts along with officials from the Sigiriya area, LOLC Holdings and Browns Group.
“Our strategic expansion into wellness tourism with Ayugiri Ayurveda Wellness Resort Sigiriya symbolises a significant milestone for Browns Hotels & Resorts. Wellness tourism has consistently outperformed the overall tourism industry for over a decade, reflecting a growing global interest in travel that goes beyond leisure to offer rejuvenation and holistic well-being. By integrating the timeless wisdom of Ayurveda with modern luxury, we aim to set a new standard in luxury wellness tourism in Sri Lanka. Whether your goal is prevention, healing, or a deeper connection to inner harmony, Ayugiri offers a sanctuary for holistic well-being” stated Eksath Wijeratne.
Ayugiri encapsulates the essence of life, inspired by the lotus flower held by the graceful queens of the infamous Sigiriya frescoes. Just as the lotus emerges from the murky depths, untainted and serene,
Ayugiri invites guests on a journey of purity and rejuvenation, harmonised with a balance of mind, body and spirit, the essence of nature, echoes of culture and the wisdom of ancient Ayurvedic healing.
HNB General Insurance, one of Sri Lanka’s leading general insurance providers, has been honored as the Best General Bancassurance Provider in Sri Lanka 2024 by the prestigious Global Banking and Finance Review – UK.
The esteemed accolade underscores HNB General Insurance’s unwavering commitment to excellence and its outstanding performance in the field of bancassurance. Through dedication and hard work, the HNB General Insurance team has continuously endeavored to deliver innovative insurance solutions, cultivate strong relationships with banking partners, and provide unparalleled service to customers nationwide. This recognition is a testament to the team’s dedication and relentless pursuit of excellence in the bancassurance business.
“We are honored to receive this prestigious award, which reflects our team’s tireless efforts and dedication to delivering value-added insurance solutions and exceptional service through our bancassurance partnerships,” said Sithumina Jayasundara, CEO of HNB General Insurance. “This recognition reaffirms our position as a trusted insurance provider in Sri Lanka and motivates us to continue striving for excellence in serving our customers and communities.”
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