## 041526-6th-gsdr-cochairs-progress-report

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---

### Executive Summary — Overall assessment and priorities
- Most debt restructuring cases that started in 2021-22 are now largely completed, both under the Common Framework (Ethiopia, Ghana, and Zambia) and outside it (Sri Lanka and Suriname).
- Cases now involve only residual commercial creditors, except Ethiopia where an agreement with bondholders and some other commercial creditors is yet to be reached.
- Full implementation of memoranda of understanding (MOUs) with official bilateral creditors, via finalization and signature of bilateral agreements, is not yet completed in most cases.
- Debt vulnerabilities remain elevated, in particular in low-income countries, against a backdrop of elevated risk and uncertainty in the global economy.
- Additional progress is called for on:
  - Further improving restructuring processes, including under the Common Framework, to ensure countries with unsustainable debt have access to timely and adequate debt relief.
  - Stepping up support for countries with a strong reform agenda and sustainable debt, but facing short-term financing challenges; the IMF–World Bank “three-pillar approach” provides the conceptual framework.
  - Enhancing debt transparency, debt management, and sovereign investor relations.

### GSDR work since October 2025 — main advances
- Restructuring processes:
  - Advanced practical solutions to accelerate restructuring of bank loans and other non-bonded commercial debt, including engagement with the private sector and the London Coalition.
  - Welcomed the “Implementation Guide to Restructuring Private Sector Sovereign Loans” elaborated by the London Coalition, now referenced in the updated “Restructuring Playbook”.
  - Encouraged restoration of institutional knowledge within the bank community via workshops and outreach.
  - Engaged, together with the Paris Club and the Institute of International Finance (IIF), to clarify treatment of different claims, notably private loans backed by an export-credit agency (ECA).
- Comparability of Treatment (CoT) transparency and MOU implementation:
  - Agreed that the debtor can publish the three parameters against which CoT will be assessed (i.e., NPV reduction, change in debt service over the IMF program, and change in duration of the treated claims) as soon as it has reached an agreement in principle (AIP) with its official bilateral creditors, if this meets its negotiation strategy.
  - Supported publication of an “MOU implementation table” with regular updates on the status of signature of bilateral agreements to monitor finalization.
  - Agreed that “absent specific circumstances, the debtor could expect finalizing the bilateral agreements within 12 months of the MOU”, while preserving some flexibility.
- Support for LMOs and the three-pillar approach:
  - Supported publication of the practical “LMO Manual” prepared by World Bank and IMF staff to help authorities considering liability management operations (LMOs) with credit enhancements; the Manual will be updated as needed to incorporate new information and examples.
  - Discussed official bilateral creditor contributions to maintaining exposures over Fund-supported program periods where possible.
- Debt transparency, debt management, and sovereign investor relations:
  - Supported increased transparency of restructuring processes (publication of CoT parameters and MOU implementation table).
  - Supported the World Bank’s creditor-debtor debt data reconciliation exercise and recommended all G20 creditors participate.
  - Engaged on challenges associated with financial collateral and strengthening sovereign investor relations (SIR).

### Country case updates (selected specifics)
- Ethiopia:
  - OCC MOU finalized in July 2025; signature by all OCC members in December 2025.
  - First bilateral agreement implementing the MOU signed on February 11, 2026.
  - Completed the 4th review of its Fund-supported program in January 2026.
  - An AIP reached early January (year not specified in excerpt) was assessed by the OCC as not meeting CoT requirements; negotiations with bondholders still pending.
  - An AIP reached with one large commercial creditor is assessed as meeting CoT.
- Ghana:
  - Residual non-bonded commercial creditors represent less than 5 percent of the debt treatment perimeter.
  - Signature of bilateral agreements implementing the OCC MOU is ongoing.
  - Completed the 5th review of its Fund-supported program in December 2025.
- Zambia:
  - Close to full completion; residual negotiations focus on a small group of non-bonded commercial creditors.
  - Completed the 6th and final review of its Fund-supported program in January 2026.
- Sri Lanka:
  - Debt restructuring nearly complete; signature of bilateral agreements well advanced but not fully finalized.
  - Completed the 4th review of its Fund-supported program in July 2025.
  - Received emergency financing under the IMF’s Rapid Financing Instrument in December 2025 after a cyclone.
  - World Bank made up to US$120 million in emergency support available by repurposing funds.
- Suriname:
  - Finalized the second phase of its debt restructuring with Paris Club creditors in October 2025.
  - Finalization of the second phase with China is expected to be finalized soon.
  - Completed its Fund-supported program in March 2025.

### Selected process and timetable observations (from case table highlights)
- Number of months passed between SLA & program approval: examples include 10.5, 8.9, 5.2, 2.1, 7.8, 6.6.
- Program approval & 1st Review intervals: examples include 12.4, 10.4, 8.0, 6.0, 17.7, 8.8.
- Program approval & closing of bond exchange intervals: examples include N/A, 22.0, 16.0, -, 24.0, 23.0.
- First rating upgrade after debt event (examples and dates):
  - Moody's: Caa2 (6/14/2024); Caa2 (10/11/24); Caa3 (9/15/2023); Caa1 (10/22/2024); Caa1 (12/23/2024).
  - S&P: B- (10/28/2024); CCC+ (11/21/2025); CCC+ (5/9/2025); SD (12/15/2023); CCC+ (12/6/2023); CCC+ (9/19/2025).
  - Fitch: B- (10/30/2024); B- (11/28/2025); B- (6/16/2025); RD (12/27/2023); n/a; CCC+ (12/20/2024).
- Current ratings (examples): n.a. / B- / B- ; Caa2 / CCC+ / B- ; Caa1 / B- / B- ; Caa3 / SD / RD ; Caa1 / CCC+ / RD ; Caa1 / CCC+ / CCC+.
- Number of bilateral deals signed (examples): Not Applicable; 6 out of 14; 9 out of 23; 2 out of 14; 3 out of 3; 7 out of 17.
- Residual debt to be restructured, as percent of total debt in the restructuring (estimates as of March 19, 2026): 0%; 6%; 4%; -; 0%; 1.7%.

### Policy and technical work since October 2025 (selected activities)
- IMF and World Bank Executive Boards further advanced the comprehensive review of the Debt Sustainability Framework for Low-Income Countries (LIC-DSF); informal engagement on the proposed new framework in April with objective to finalize ahead of the IMF-World Bank Annual Meetings in October.
- G20 Presidency and Paris Club held a G20-Paris Club workshop on December 12 to discuss official bilateral creditor support for countries with strong reform agendas facing short-term financing challenges.
- GSDR Technical Group meetings (February 5 and March 16) examined London Coalition proposals, restructuring of non-bonded commercial debt, debt transparency improvements, and issues posed by financial collateral.
- Paris Club organized a workshop on March 5 to clarify how the Paris Club assesses CoT across creditors and creditor groups.
- Paris Club, IIF, and London Coalition co-organized a March 10 workshop on private loans backed by export-credit agencies.
- GSDR Open Workshop on March 19 discussed enhancing debt transparency, debt management, and sovereign investor relations; participants included GSDR members, G20 members, Paris Club members, private creditors, borrowers, MDBs, CSOs, CRAs, advisory firms, and debt experts.
- G20 and Paris Club are working on a template MOU for Common Framework cases.
- GSDR Deputies met on March 27 to review and advance technical work ahead of GSDR Principals meeting on April 15.

### 2. Stepping up support for countries with a strong reform agenda and sustainable debt, but facing short-term financing challenges
- Operational focus and two specific aspects:
  - How official bilateral creditors can support the collective effort.
  - What concrete actions can be done to help countries considering liability management operations (LMOs).
- Support from official bilateral creditors:
  - G20 Presidency and Paris Club workshop in December shared information on measures taken by various bilateral partners to support countries facing short-term financing challenges.
  - Participants underlined the increasing use of crisis-resilient debt clauses, debt-for-development swaps, and other flexible arrangements.
  - Official bilateral creditors could contribute by aiming at maintaining, where possible, for countries engaged in Fund-supported programs, their exposures over the program period.
- Liability Management Operations (LMOs):
  - LMOs can reduce short-term liquidity constraints and create space for growth-enhancing investment and broader development needs.
  - Guarantees or insurances – provided by the official or the private sector – can make LMOs more effective by compressing borrowing costs, extending maturities, and broadening or strengthening investor demand.
  - Impact depends on country context and design; LMOs are not fit to any situation and come with costs and risks.
  - World Bank and IMF staff prepared a practical note (LMO Manual) to guide decisions when considering LMOs with credit enhancements; the note draws on recent LMOs and a survey on credit enhancement availability.
  - GSDR participants supported publication of the note; the Manual will be updated as needed to incorporate new information, including examples of LMO transactions and their key design features.
- Enhancing debt transparency, debt management, and sovereign investor relations:
  - Improve transparency of restructuring processes (publication of the three CoT parameters upon AIP and publication of an “MOU implementation table” with regular updates).
  - Support the World Bank’s creditor-debtor debt data reconciliation exercise and recommend all G20 creditors participate.
  - Strengthen institutional frameworks; example cited: recent amendments to domestic laws in Zambia to improve debt transparency.
  - Address challenges associated with financial collateral: use transparently and appropriately; opaque and complex arrangements pose significant risks; data on financial collateral often not published.
  - Develop Sovereign Investor Relations (SIR) as a critical debt management function to ensure timely, consistent, and credible information sharing to market participants and stakeholders; SIR is not a substitute for sound macroeconomic policies or necessary adjustments/restructuring.

### Section 3: Next Steps for GSDR Work — prioritized actions
- GSDR Principals supported advancing work on:
  1. Stepping up support for countries with a strong reform agenda and sustainable debt, but facing short-term financing challenges, including:
     - Further engagement with official bilateral creditors, including through the Paris Club and the G20, on how official bilateral creditors could contribute to this support.
     - Preliminary sharing of experience on the implementation of LMOs with credit enhancement.
  2. Continuing progress on debt restructuring processes, including:
     - a. Taking stock of the experience with state-contingent debt instruments in the recent restructuring cases.
     - b. Following up on the work at the London Coalition, including dissemination and awareness raising on the “Implementation Guide to Restructuring Private Sector Sovereign Loans”, “Practice Note” on ECA-backed loans, and ongoing work on debt pause clauses in international bonds and contractual provisions for loans.
     - c. Following up on issues related to financial collateral, including potential implications of such instrument for debt restructuring.
     - d. Following up on the implementation of OCC MOUs through bilateral agreements and identifying further incentives to expedite this process.
     - e. Exchanging views and experience on how privately held sovereign debt for which an arbitration has been launched are being approached in the broader restructuring.
     - f. Exchanging views on ways to improve coordination for countries not eligible to the Common Framework.

*041526-6th-gsdr-cochairs-progress-report (excerpts).*

### Executive Summary

### Executive Summary

### Overall assessment and priorities
- Most debt restructuring cases that started in 2021-22 are now largely completed, both under the Common Framework (Ethiopia, Ghana, and Zambia) and outside it (Sri Lanka and Suriname).  
- Cases now involve only residual commercial creditors, except Ethiopia where an agreement with bondholders and some other commercial creditors is yet to be reached.  
- Full implementation of memoranda of understanding (MOUs) with official bilateral creditors, via finalization and signature of bilateral agreements, is not yet completed in most cases.  
- Debt vulnerabilities remain elevated, in particular in low-income countries, against a backdrop of elevated risk and uncertainty in the global economy.  
- Additional progress is called for on:
  - Further improving restructuring processes, including under the Common Framework, to ensure countries with unsustainable debt have access to timely and adequate debt relief.
  - Stepping up support for countries with a strong reform agenda and sustainable debt, but facing short-term financing challenges; the IMF–World Bank “three-pillar approach” provides the conceptual framework.
  - Enhancing debt transparency, debt management, and sovereign investor relations.

### GSDR work since October 2025 — main advances
- Restructuring processes:
  - Advanced practical solutions to accelerate restructuring of bank loans and other non-bonded commercial debt, including engagement with the private sector and the London Coalition.
  - Welcomed the “Implementation Guide to Restructuring Private Sector Sovereign Loans” elaborated by the London Coalition, now referenced in the updated “Restructuring Playbook”.
  - Encouraged restoration of institutional knowledge within the bank community via workshops and outreach.
  - Engaged, together with the Paris Club and the Institute of International Finance (IIF), to clarify treatment of different claims, notably private loans backed by an export-credit agency (ECA).
- Comparability of Treatment (CoT) transparency and MOU implementation:
  - Agreed that the debtor can publish the three parameters against which CoT will be assessed (i.e., NPV reduction, change in debt service over the IMF program, and change in duration of the treated claims) as soon as it has reached an agreement in principle (AIP) with its official bilateral creditors, if this meets its negotiation strategy.
  - Supported publication of an “MOU implementation table” with regular updates on the status of signature of bilateral agreements to monitor finalization.
  - Agreed that “absent specific circumstances, the debtor could expect finalizing the bilateral agreements within 12 months of the MOU”, while preserving some flexibility.
- Support for LMOs and the three-pillar approach:
  - Supported publication of the practical “LMO Manual” prepared by World Bank and IMF staff to help authorities considering liability management operations (LMOs) with credit enhancements; the Manual will be updated as needed to incorporate new information and examples.
  - Discussed official bilateral creditor contributions to maintaining exposures over Fund-supported program periods where possible.
- Debt transparency, debt management, and sovereign investor relations:
  - Supported increased transparency of restructuring processes (publication of CoT parameters and MOU implementation table).
  - Supported the World Bank’s creditor-debtor debt data reconciliation exercise and recommended all G20 creditors participate.
  - Engaged on challenges associated with financial collateral and strengthening sovereign investor relations (SIR).

### Country case updates (selected specifics)
- Ethiopia:
  - OCC MOU finalized in July 2025; signature by all OCC members in December 2025.
  - First bilateral agreement implementing the MOU signed on February 11, 2026.
  - Completed the 4th review of its Fund-supported program in January 2026.
  - An AIP reached early January (year not specified in excerpt) was assessed by the OCC as not meeting CoT requirements; negotiations with bondholders still pending.
  - An AIP reached with one large commercial creditor is assessed as meeting CoT.
- Ghana:
  - Residual non-bonded commercial creditors represent less than 5 percent of the debt treatment perimeter.
  - Signature of bilateral agreements implementing the OCC MOU is ongoing.
  - Completed the 5th review of its Fund-supported program in December 2025.
- Zambia:
  - Close to full completion; residual negotiations focus on a small group of non-bonded commercial creditors.
  - Completed the 6th and final review of its Fund-supported program in January 2026.
- Sri Lanka:
  - Debt restructuring nearly complete; signature of bilateral agreements well advanced but not fully finalized.
  - Completed the 4th review of its Fund-supported program in July 2025.
  - Received emergency financing under the IMF’s Rapid Financing Instrument in December 2025 after a cyclone.
  - World Bank made up to US$120 million in emergency support available by repurposing funds.
- Suriname:
  - Finalized the second phase of its debt restructuring with Paris Club creditors in October 2025.
  - Finalization of the second phase with China is expected to be finalized soon.
  - Completed its Fund-supported program in March 2025.

### Selected process and timetable observations (from case table highlights)
- Number of months passed between SLA & program approval: examples include 10.5, 8.9, 5.2, 2.1, 7.8, 6.6.
- Program approval & 1st Review intervals: examples include 12.4, 10.4, 8.0, 6.0, 17.7, 8.8.
- Program approval & closing of bond exchange intervals: examples include N/A, 22.0, 16.0, -, 24.0, 23.0.
- First rating upgrade after debt event (examples and dates):
  - Moody's: Caa2 (6/14/2024); Caa2 (10/11/24); Caa3 (9/15/2023); Caa1 (10/22/2024); Caa1 (12/23/2024).
  - S&P: B- (10/28/2024); CCC+ (11/21/2025); CCC+ (5/9/2025); SD (12/15/2023); CCC+ (12/6/2023); CCC+ (9/19/2025).
  - Fitch: B- (10/30/2024); B- (11/28/2025); B- (6/16/2025); RD (12/27/2023); n/a; CCC+ (12/20/2024).
- Current ratings (examples): n.a. / B- / B- ; Caa2 / CCC+ / B- ; Caa1 / B- / B- ; Caa3 / SD / RD ; Caa1 / CCC+ / RD ; Caa1 / CCC+ / CCC+.
- Number of bilateral deals signed (examples): Not Applicable; 6 out of 14; 9 out of 23; 2 out of 14; 3 out of 3; 7 out of 17.
- Residual debt to be restructured, as percent of total debt in the restructuring (estimates as of March 19, 2026): 0%; 6%; 4%; -; 0%; 1.7%.

### Policy and technical work since October 2025 (selected activities)
- IMF and World Bank Executive Boards further advanced the comprehensive review of the Debt Sustainability Framework for Low-Income Countries (LIC-DSF); informal engagement on the proposed new framework in April with objective to finalize ahead of the IMF-World Bank Annual Meetings in October.
- G20 Presidency and Paris Club held a G20-Paris Club workshop on December 12 to discuss official bilateral creditor support for countries with strong reform agendas facing short-term financing challenges.
- GSDR Technical Group meetings (February 5 and March 16) examined London Coalition proposals, restructuring of non-bonded commercial debt, debt transparency improvements, and issues posed by financial collateral.
- Paris Club organized a workshop on March 5 to clarify how the Paris Club assesses CoT across creditors and creditor groups.
- Paris Club, IIF, and London Coalition co-organized a March 10 workshop on private loans backed by export-credit agencies.
- GSDR Open Workshop on March 19 discussed enhancing debt transparency, debt management, and sovereign investor relations; participants included GSDR members, G20 members, Paris Club members, private creditors, borrowers, MDBs, CSOs, CRAs, advisory firms, and debt experts.
- G20 and Paris Club are working on a template MOU for Common Framework cases.
- GSDR Deputies met on March 27 to review and advance technical work ahead of GSDR Principals meeting on April 15.

### Looking ahead — GSDR Principals’ support
- Stepping up support for countries with a strong reform agenda and sustainable debt, but facing short-term financing challenges, including further engagement with official bilateral creditors on how they could contribute and preliminary sharing of experience on LMOs with credit enhancement.
- Continuing progress on debt restructuring processes, focusing on targeted technical issues and exploring ways to improve coordination for countries not eligible to the Common Framework.

_Executive Summary — 041526-6th-gsdr-cochairs-progress-report - Executive Summary_

### 2. Stepping up support for countries with a strong reform agenda and sustainable debt, but facing

### 2. Stepping up support for countries with a strong reform agenda and sustainable debt, but facing short-term financing challenges

### Operational focus and two specific aspects
- Recognizing that the operationalization of the 3-pillar approach entails multiple partners, the GSDR work since October has focused on two specific aspects:
  - how official bilateral creditors can support the collective effort, and
  - what concrete actions can be done to help countries considering liability management operations (LMOs).

### Support from official bilateral creditors
- The G20 Presidency and the Paris Club held in December a useful workshop aimed at sharing information on the measures taken by various bilateral partners to support countries facing short-term financing challenges.
- Participants underlined the increasing use of crisis-resilient debt clauses, which have been adopted by a number of bilateral creditors to support countries faced with shocks, but also the use of debt-for-development swaps and other flexible arrangements.
- With the view to step up support for countries with a strong reform agenda and sustainable debt, but facing short-term financing challenges, official bilateral creditors could contribute to the collective effort by aiming at maintaining, where possible, for countries engaged in Fund-supported programs, their exposures over the program period.

### Liability Management Operations (LMOs)
- GSDR participants continued to advance concrete steps that can help countries considering LMOs.
- LMOs can reduce short-term liquidity constraints and create space for growth-enhancing investment and broader development needs.
- Guarantees or insurances – provided by the official or the private sector – can make LMOs more effective by compressing borrowing costs, extending maturities, and broadening or strengthening investor demand.
- However, their impact depends on country context and the design of the specific operation. LMOs should not be seen as fit to any situation, nor coming without costs and risks.
- Staff from the World Bank and the IMF have prepared a practical note aimed at providing policy makers and debt managers with a user-friendly manual to guide decisions when considering LMOs with credit enhancements.
- The note draws on insights from recent LMOs and the results of a survey on credit enhancement availability conducted among major bilateral and multilateral providers.
- GSDR participants supported the publication of this note, building on the feedback received on a first draft during the March 16 meeting.
- The Manual will be updated as needed to incorporate new information, including examples of LMO transactions and their key design features.

### Enhancing debt transparency, debt management, and sovereign investor relations
- GSDR participants showed widespread support for concrete steps to improve debt transparency. This includes:
  - Improving the transparency of restructuring processes. This includes key steps such as the publication of the three parameters against which CoT will be assessed as soon as of an AIP has been reached with official bilateral creditors; and the publication of an “MOU implementation table”, with regular updates on the status of signature of the bilateral agreements implementing OCC MOUs to facilitate implementation monitoring.
  - Improving creditor-debtor debt data reconciliation. There is broad support to the World Bank’s ongoing creditor-debtor debt data reconciliation exercise, and for a GSDR recommendation for all G20 creditors to participate in it.
  - Strengthening institutional frameworks. Recent amendments to domestic laws to improve debt transparency, such as in Zambia, provide examples on how strengthening institutional frameworks can be conducive to debt transparency. On the flipside, high profile cases of misreporting in some countries highlight how institutional shortcomings can undermine transparency and creditor confidence.
  - Addressing challenges associated with financial collateral. GSDR discussions noted the role collateralized lending can play, while emphasizing the importance to use it transparently and appropriately. Recent cases of opaque and complex arrangements involving financial collateral involve significant risks. It is difficult to assess the scale of financial collateralization since data is often not published, which undermines sound lending and borrowing decisions. Similarly, the use of financial collateral raises important questions regarding its treatment in the event of a restructuring.
  - Developing sovereign investor relations. Sovereign Investor Relations (SIR) is a critical debt management function to ensure timely, consistent, and credible information sharing to market participants and stakeholders. SIR is not an alternative to sound and credible macroeconomic policies and cannot replace adjustments or restructuring when these are needed. But SIR can support financing strategies by informing clearly and in a timely manner creditors, investors, and credit rating agencies, thus reducing information asymmetries and strengthening confidence. SIR is particularly important in periods of heightened uncertainty and potential stress in international financial conditions, as well as country-specific debt vulnerabilities, including following a debt restructuring.

### Section 3: Next Steps for GSDR Work — prioritized actions
- Looking ahead, GSDR Principals supported advancing work at the GSDR and in other fora on:
  1. Stepping up support for countries with a strong reform agenda and sustainable debt, but facing short-term financing challenges. This could include further engagement with official bilateral creditors, including through the Paris Club and the G20, on how official bilateral creditors could contribute to this support, as well as preliminary sharing of experience on the implementation of LMOs with credit enhancement.
  2. Continuing progress on debt restructuring processes. This could include:
     - a. taking stock of the experience with state-contingent debt instruments in the recent restructuring cases.
     - b. following up on the work at the London Coalition, including on dissemination and awareness raising on the “Implementation Guide to Restructuring Private Sector Sovereign Loans”, “Practice Note” on ECA-backed loans, and ongoing work on debt pause clauses in international bonds and contractual provisions for loans.
     - c. following up on issues related to financial collateral, including potential implications of such instrument for debt restructuring.
     - d. following up on the implementation of OCC MOUs through bilateral agreements and identifying further incentives to expedite this process.
     - e. exchanging views and experience on how privately held sovereign debt for which an arbitration has been launched are being approached in the broader restructuring.
     - f. exchanging views on ways to improve coordination for countries not eligible to the Common Framework.

*041526-6th-gsdr-cochairs-progress-report (excerpts).*

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_Source: https://www.imf.org/-/media/files/about/faq/gsdr/041526-6th-gsdr-cochairs-progress-report.pdf_