Sri Lanka has reached agreement on terms with more than 98% of its external creditors and fully implemented over 90% of its public external debt restructuring as of July 2025, according to the Ministry of Finance, Planning and Economic Development.

The restructuring covers both bilateral and commercial debt, with notable progress including concluded agreements with the China Exim Bank, Saudi Arabia, and the China Development Bank. Deals with the Official Creditor Committee — comprising 17 countries — have been signed with Japan, India, France, and Hungary, while negotiations with other bilateral lenders such as Kuwait and smaller creditors are in the final stages.

On the commercial side, the government completed a US$ 10.6 billion International Sovereign Bond exchange in December 2024, with 98% of bondholders participating. Debt treatment discussions are still ongoing with SriLankan Airlines bondholders and other minor commercial creditors.

Authorities said the restructuring has placed the country’s debt on a sustainable path, meeting all key IMF debt sustainability targets, including reducing the debt-to-GDP ratio to below 95% by 2032, maintaining average gross financing needs at 13% of GDP, and capping foreign currency debt service at 4.5% of GDP in the medium term.