Central Bank Governor Dr. Nandalal Weerasinghe says Sri Lanka’s ability to repay both domestic and foreign debt has improved significantly due to recent positive economic developments and strengthened debt management.
Speaking on the country’s economic outlook, Dr. Weerasinghe noted that Sri Lanka’s debt burden has declined from 105 percent to 95 percent of Gross Domestic Product (GDP), reflecting progress made through fiscal reforms and public debt restructuring efforts.
The Governor stated that the Extended Fund Facility (EFF) programme secured from the International Monetary Fund (IMF) is scheduled to conclude next year. However, he said it is still too early to determine whether the Government will seek a new financial arrangement with the IMF after the current programme ends.
Dr. Weerasinghe also pointed out that Sri Lanka has regained access to international financing opportunities and that growing confidence in the country’s debt sustainability has strengthened its standing among foreign investors and financial markets.
He emphasized that borrowing for productive investments and asset creation is more beneficial than avoiding loans altogether, provided that funds are used responsibly.
According to the Governor, it is the responsibility of policymakers to maximize the effective use of both domestic and foreign financing to support infrastructure development and economic growth, while ensuring strong safeguards against corruption, waste, and excessive borrowing costs.
He added that maintaining prudent debt management and strengthening economic fundamentals remain essential to sustaining the country’s recovery and long-term financial stability.
