July 02, Colombo (LNW): President Ranil Wickremesinghe speaking in Parliament this (02) morning disclosed that Sri Lanka has become one of the pioneering middle-income countries to adopt a new framework for debt sustainability analysis, specifically designed for nations in this economic bracket, in order to embark on debt restructuring.
In his address to Parliament, the President highlighted that Sri Lanka’s foreign debt stands at US$ 37 billion.
This includes US$ 10.6 billion in bilateral debt, US$ 11.7 billion in multilateral debt, US$ 14.7 billion in commercial debt, and US$ 12.5 billion in sovereign bonds.
Wickremesinghe emphasised that agreements were reached on June 26 with Sri Lanka’s official creditors regarding debt repayment, with authorised Cabinet officials signing these agreements on behalf of the country.
Detailing the specifics of the agreements with the official creditor committee chaired by India, Japan, France, and China Exim Bank, the President noted that the terms include a grace period for principal repayment extended until 2028.
He also highlighted that interest rates have been maintained at or below 2.1 per cent, with a full debt repayment grace period extended until 2043.
Moreover, under the restructuring agreements, the President explained that the repayment of the principal loan amount can be gradually increased, thereby deferring debt servicing costs.
As a result of these agreements, President Wickremesinghe stated that Sri Lanka’s remaining debt service amounts to US$ 5 billion.
