Sri Lanka

Sri Lanka: Most Favored Creditor clause could expedite debt restructuring

  • Sri Lanka is reportedly considering introduction of “Most Favored Creditor” (MFC) clause in its debt restructuring

  • Aim is to deter holdouts by reopening restructuring if more favourable terms are offered to holdout creditors in future

  • Could reduce risk of China or other non-Paris Club creditors delaying restructuring, but unclear if it will be effective
December 14th, 2022
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