SriLankan Airlines defaults on $175 mln state-backed bond

Reuters – State-owned SriLankan Airlines has defaulted on a $175 million bond as it was unable to meet a $6 million interest payment due in December, its chairperson told Reuters on Thursday, as the country struggles with its worst economic crisis in decades.

The country of 22 million itself defaulted on loans last year and is seeking $2.9 billion urgently from the International Monetary Fund to tide over a severe shortage of dollars to buy essentials.

“We will follow treasury guidelines on this. We are also engaging with bondholders,” SriLankan Airlines Chairperson Ashok Pathirage said.

The government-guaranteed unsecured notes are due in 2024.

President Ranil Wickremesinghe told parliament on Wednesday that Sri Lanka’s economy was expected to grow again from the end of this year and hoped the country would emerge from the economic crisis by 2026.

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