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President announces ‘Significant Milestone’ in SL’s debt restructuring: MPs urged to help ratify agreements

June 27, Colombo (LNW): President Ranil Wickremesinghe has declared that the nation has finalised agreements for restructuring its external debt with bilateral creditors, in what he described as ‘a significant milestone’ in Sri Lanka’s recent history.

In his special address yesterday (26), Wickremesinghe highlighted the positive outcomes of the government’s diligent efforts, revealing that Sri Lanka has secured a final restructuring agreement for US$ 5.8 billion of debt with its bilateral lenders’ Official Creditor Committee in Paris.

Additionally, a debt treatment agreement has been signed with the Export-Import Bank of China in Beijing to restructure US$ 4.2 billion of debt.

The President affirmed that all necessary formalities are currently being implemented. He expressed optimism, stating, “For those who truly care about our country, this is excellent news. Sri Lanka has triumphed.”

President Wickremesinghe emphasised that these agreements enhance international confidence in Sri Lanka, describing them as an endorsement of the nation’s credibility. “The global community, which previously refused to accept our letters of credit, is now willing to vouch for us,” he noted.

Further, he announced that Prime Minister Dinesh Gunawardena will present these agreements to Parliament on 2nd July, urging all patriotic members to support their ratification.

He also underscored that the nation’s economic issues cannot be resolved through strikes or threats but through united efforts to strengthen the economy.

The President detailed the benefits of the debt restructuring agreements, including the postponement of bilateral loan payments until 2028 and the extension of repayment terms until 2043.

He noted that Sri Lanka had allocated 9.2 cent of its GDP to foreign debt payments in 2022, but this figure is expected to drop to less than 4.5 per cent between 2027 and 2032, marking a significant fiscal improvement.

President Wickremesinghe also reflected on the challenging journey since the country’s declaration of its inability to repay loans in 2022, which led to the suspension of foreign-funded projects and international transactions.

He highlighted that the successful debt restructuring now allows for the resumption of these projects and transactions.

Expressing gratitude to all parties involved, including ministers, officials, and the majority of citizens who supported the government’s efforts, President Wickremesinghe criticised those attempting to disrupt the country’s progress.

He assured that continued economic improvement would provide relief to the people and called for unity in strengthening the economy.

The President concluded by reaffirming his commitment to rebuilding the economy through planned policies, dedication, and international support, expressing confidence in Sri Lanka’s ability to achieve a developed economy by 2048.

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