By: Isuru Parakrama
October 15, Colombo (LNW): The Sri Lankan government is set to strengthen its public debt management framework following the recent implementation of the Public Debt Management Act No. 33 of 2024.
This legislation mandates the creation of a Public Debt Management Office (PDMO), designed to ensure that public debt data is recorded accurately, comprehensively, and in a timely manner through a robust system.
Presently, Sri Lanka relies on the Commonwealth Secretariat Debt Recording and Management System (CS-DRMS) for the management of its foreign debt, a tool overseen by the Department of Foreign Resources.
However, the Commonwealth Secretariat has halted updates and annual licensing for the CS-DRMS, highlighting the urgent need for an upgraded system that meets contemporary requirements.
In light of this situation, the government has engaged in discussions with technical experts from the International Monetary Fund (IMF) and the World Bank to explore the establishment of the PDMO.
Two promising software alternatives have emerged: the Commonwealth Meridian software, provided by the Commonwealth Secretariat, and the Debt Management and Financial Analysis System (DMFAS) from the United Nations Conference on Trade and Development (UNCTAD).
After thorough evaluation, the government has favoured the Commonwealth Meridian software for adoption.
This choice is underpinned by several considerations, including its cost-effectiveness, streamlined data transmission capabilities, assurance of data integrity, and compatibility with existing systems, as detailed by the Cabinet Office.
In a meeting held on Monday, 14 October, the Cabinet of Ministers endorsed the proposal put forth by President Anura Kumara Dissanayake, who serves as the Minister of Finance, to procure the Commonwealth Meridian software.
Furthermore, the Cabinet plans to solicit recommendations from a procurement committee appointed specifically for this purpose to facilitate the acquisition process.
The Cabinet Office has emphasised that this initiative is expected to substantially enhance Sri Lanka’s capacity to manage its public debt more effectively, thereby ensuring increased transparency and accuracy in reporting debt-related information.
As the country faces various economic challenges, these improvements in debt management are seen as essential for maintaining fiscal stability and fostering investor confidence.
By implementing a more efficient system, Sri Lanka aims to better navigate its financial obligations whilst promoting sound economic governance.
