COLOMBO, Sept. 19 (Xinhua) -- Sri Lanka has reached agreements in principle on restructuring approximately 17.5 billion U.S. dollars of external commercial debt, the President's Media Division (PMD) said in a press release on Thursday.

These agreements have been reached with holders of its international sovereign bonds, following negotiations with the Ad Hoc Group of Bondholders, a representative group of international investors, and the Local Consortium of Sri Lanka, a representative group of domestic financial institutions, according to the PMD.

Collectively, the two groups hold in excess of 50 percent of the bonds, said the PMD.

Under the agreements, holders of the bonds will be consenting to a present value concession of 40.3 percent in the baseline scenario, calculated with a discount factor of 11 percent.

The agreements provide Sri Lanka with enhanced debt relief compared to a joint working framework agreed in July 2024, including a further reduction in interest payments provided in the new agreement, according to the PMD.

Sri Lanka's Ministry of Finance said this provided significant debt relief and reduced interest payments, strengthening the country's financial stability. Enditem

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