July 15, Colombo (LNW): Sri Lanka has officially concluded a key bilateral agreement with the Saudi Fund for Development (SFD), marking a notable advancement in the nation’s broader strategy to restructure its external debt amidst ongoing fiscal recovery efforts.
The pact, formalised on July 14, 2025, involves the amendment and restructuring of existing loan arrangements, totalling more than 516 million Saudi Riyals.
The agreement was signed by Dr. Harshana Suriyapperuma, Secretary to the Ministry of Finance, Planning, and Economic Development, and Sultan Abdulrahman A. Almarshad, Chief Executive Officer of the SFD, during a bilateral meeting that underscored the strong diplomatic and economic ties between the two nations.
This development comes at a time when Sri Lanka continues to navigate the complexities of its debt stabilisation process following the 2022 debt default. Despite the suspension of international debt repayments during the country’s financial crisis, Saudi Arabia maintained its development support through the SFD, allowing key infrastructure and public service projects to proceed without interruption.
The restructured loans were extended on highly favourable terms, which Sri Lankan authorities say will ease pressure on the country’s repayment obligations over the long term.
According to the Ministry of Finance, the continued financial cooperation from Riyadh serves not only as a vote of confidence in Sri Lanka’s reform agenda but also as a crucial instrument in advancing national development goals during a delicate recovery phase.
The restructured financing arrangements are expected to free up resources for vital sectors including healthcare, education, and transport, while also bolstering investor confidence in the country’s ongoing fiscal reforms.
Officials noted that the Kingdom of Saudi Arabia has been a longstanding development partner to Sri Lanka, with a portfolio of support ranging from energy and infrastructure to rural development and humanitarian relief.
