Lanka struggles to repay record foreign debt : Sri Lanka’s prime minister
Posted on January 12th, 2019

Courtesy The Island

(AFP) Sri Lanka’s prime minister said the country was struggling to pay back its ballooning foreign debt, blaming a recent political crisis for dealing a “death blow” to the economy.

Ranil Wickremesinghe said his government was scrambling to raise $1.9 billion to help service a first debt payment of $2.6 billion, that is due on Monday.

Sri Lanka faces $5.9 billion in foreign debt repayments in 2019, a record for the cash-strapped island.

The country lost $1 billion in foreign reserves during a power struggle between Wickremesinghe and President Maithripala Sirisena in late 2018.

Sirisena sacked Wickremesinghe in October and later dissolved parliament to quell any opposition, but Sri Lanka’s courts deemed the move unconstitutional.

Wickremesinghe was reinstalled 51 days later but not without a cost, the prime minister said.

“We are yet to quantify the losses, but it was a death blow to an economy that was struggling to recover,” Wickremesinghe told parliament.

Three global ratings agencies downgraded Sri Lanka during the crisis, making it more expensive for the Indian Ocean nation to access foreign loans.

Sri Lanka hopes to raise $1 billion from the international debt market, another $500 million from China and Japan and a further $400 million from the Reserve Bank of India.

Wickremesinghe has dispatched his finance minister to Washington to try to revive a loan arrangement with the International Monetary Fund that was suspended during the chaos.

Sri Lanka narrowly averted defaulting on its sovereign debt after Wickremesinghe’s reformed administration introduced a plan late last month to meet urgent spending obligations for the first four months of 2019.

Sirisena came to power in 2015 with the help of Wickremesinghe’s United National Party but personal and political clashes came to a head before the October sacking.

2 Responses to “Lanka struggles to repay record foreign debt : Sri Lanka’s prime minister”

  1. Ancient Sinhalaya Says:

    Traitor chief die hard catholic token Buddhist bay gal karaya mega thief mega thakkadiya walking crime bomb
    (against Sinhalese Buddhsts, Sri Lanka and Buddhism only) Batalande Wa(n)dakaya Pol Pot r@’ni_leech wickrama
    Sinhala killer done so much ‘work’ for the last 4 years and in that 51 days MR ruined everything. Lajja nathi baya
    nathi traitor chief Batalande Wa(n)dakaya still surviving thanks to the work MR done during his time. Thanks to
    him, war stopped, tourism boomed and Sri Lanka prospered. Then traitor chief low life came and straightaway
    broke into the CB with its catholic buddy mahahorandran and got away with Rs 5585 billions. After destroying
    a blooming country with the low life’s traitor gang now it want to break up the country to please tamils, mussies,
    india and the west.

    The traitor low life is a curse on Mother Lanka, Sinhalese (Buddhist) race and Buddhism. Hope
    this year will be the last year on the planet for an out and out number one dhrohiya’s life of crimes, lies, robberies,
    murders and treacheries. Lajja nathi baya nathi aga matta is simply the worst 2 legged creature born on this land.
    Poor Mother Lanka to have a treacherous creature like this who hasn’t done a single good deed in its life of crimes,
    lies, murders, robberies and treacheries.

  2. aloy Says:

    This AFP report copied by the Island says the PM has said that the political crisis dealt a death blow to the economy. Actually a death blow to economy was delivered by him when CB was broken into and the whole world saw what happened. Nobody in sane mind will want to keep investments in a country where the government itself steals money from its banks. Such a country has no future. In any case a near death blow to economy is much better than death to the country itself. That is what the plan was and it was thwarted by the prez’s timely action. So any loss to the economy is peanuts when compared to he actual loss that would have been.
    We have seen already MR spoke only once in the parliament giving his party’s firm stand against the proposed constitution as opposition leader and the UNP has got cold feet. So, the October 26th coup had its positive results. These external debts do not bother our leaders as long as there are enough women for export to ME as slaves who will somehow shoulder the repayment. They will go on borrowing for mega projects ( to get money for electioneering) and also go on increasing the salaries of unproductive state employees in the hope of getting their votes. This is the reality in our island.

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