International academics speak out on dealing with Sri Lankan debt
Professor Gary Dymski is one of a number of international academics to sign a letter on the Sri Lankan debt crisis.
The group of 182 international economists, financial professionals, development experts and other civil society leaders have issued a statement concerning Sri Lanka’s external debt crisis.
The letter says that debt negotiations are now at a "crucial stage" and that there was previously a lack of transparency in the process.
Private creditors own almost 40% of Sri Lanka’s external debt stock, mostly in the form of International Sovereign Bonds (ISBs), but higher interest rates mean that they receive over 50% of external debt payments. Such lenders charged a premium to lend to Sri Lanka to cover their risks, which accrued them massive profits and contributed to Sri Lanka’s first-ever default in April 2022. Lenders who benefited from higher returns because of the “risk premium” must be willing to take the consequences of that risk.
View Professor Gary Dymski’s profile
Coverage of this news can be found:
DailyFT - 'International academics speak out on dealing with Sri Lankan debt'
Economynext.com - 'Sri Lanka bond holders earned high returns, should now take the hit: Picketty, academics'