Sri Lanka Halts Debt Repayment Pending IMF Bailout Plan

Sri Lanka Halts Debt Repayment Pending IMF Bailout Plan
Sri Lankans during a protest outside the president's office in Colombo, Sri Lanka, on April 11, 2022. Eranga Jayawardena/AP Photo
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COLOMBO, Sri Lanka—Sri Lanka is suspending its repayment of foreign debt, including bonds and government-to-government borrowing, pending the completion of a loan restructuring program with the International Monetary Fund to deal with the island nation’s worst economic crisis in decades, the government announced Tuesday.

Sri Lankans in recent months have endured fuel and food shortages and daily power outages. Most of those items are paid for in hard currency, but Sri Lanka is on the brink of bankruptcy, saddled with dwindling foreign reserves and $25 billion in foreign debt due for repayment over the next five years. Nearly $7 billion is due this year.