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SL to raise up to $2bn in foreign borrowings

11 June 2015 06:21 pm - 18     - {{hitsCtrl.values.hits}}

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Sri Lanka's new government plans to borrow up to $2.0 billion from overseas, the finance minister said Thursday, just two weeks after raising a billion through its first international bond issue.

Minister Ravi Karunanayake said the government was seeking at least $1.0 billion with a five-year tenure, but may increase the loan amount to $2.0 billion depending on the market response.

"Tomorrow we will advertise and call for bids. We hope to collect $1.0 billion in a couple of days. It would even go up to $2.0 billion," Karunanayake said.

The move to raise foreign cash comes amid rising domestic spending and shortfalls in revenue collection, the minister said, while accusing the previous administration of overstating revenues and under estimating expenditure.

"We want to borrow at low interest rates to pay off the high interest loans taken by the previous government," the minister told the Foreign Correspondents' Association of Sri Lanka.

The Central Bank of Sri Lanka last month raised $988 million through the combination of a 10-year bond and shorter term bonds at a weighted average cost of 5.261 percent a year.

The government has increased welfare spending and reduced the price of fuel and utilities in line with election promises ahead of the January 8 presidential vote won by Maithripala Sirisena.

Despite a marginal improvement in tax collection, President Sirisena's government is hard pressed for cash to meet new spending commitments.

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  Comments - 18

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  • Manish Friday, 12 June 2015 09:37 AM

    Previous government borrowed per project. This one is borrowing billions and then handing them out through hand outs. This is so irresponsible

    fcid Saturday, 13 June 2015 11:33 PM

    i though Harsha said we were in a debt trap..

    Nims Saturday, 13 June 2015 03:55 AM

    To all those who didnt like my comment: I am neither a supporter of MR or any other politician. It is a clear indication that you guys are justifying the robbery committed by Mahendran. Then why do you guys talk about the corruptions of MR and his associates???

    lipwe Saturday, 13 June 2015 03:27 AM

    You mean taking 6% loan from bond market instead of 2% loan from china

    sss Friday, 12 June 2015 03:59 PM

    how much of these is spent on petrol for duty free cars whose owners contribute nothing for the economy. rural men gave their lives to safe us from terrorism. we are sending their sisters to middle east to get dollars

    Eng.M.V.R.Perera Friday, 12 June 2015 03:40 PM

    why not abolish Provincial Councils

    DHA Friday, 12 June 2015 02:44 PM

    Very true....

    Cheers Friday, 12 June 2015 01:39 PM

    Time to rob in your short stay and FCID will grill you when new govt comes

    Srinath Friday, 12 June 2015 11:18 AM

    Give the govt back to Mahinda, He will continue the development. He knew the vicious cycle of borrowing and subsidy. But people could not tolerate it. This UNP is so incapable, irresponsible and power hungry.Ther are gone mad without money. How comeuncle sam and uncle Dave did not come to help you!We need a criminal investigation for the bond issue!

    Analyst Friday, 12 June 2015 07:05 AM

    Hurry up, Hurry up. you should get as much as possible during this short stay in power.

    moda Friday, 12 June 2015 09:26 AM

    Tell MR to return the loot from masses

    moda Friday, 12 June 2015 09:24 AM

    Tell MR

    Yahapala Friday, 12 June 2015 08:57 AM

    He will surely supersede Basil within next couple of months:).

    MightyAnt Friday, 12 June 2015 08:46 AM

    Fuel subsidised ?

    cc Friday, 12 June 2015 07:39 AM

    Make sure they are low interest unlike the former gov that took bribes from china for taking high interest loans

    Nanda Friday, 12 June 2015 07:33 AM

    He says it like a hero!. These again a loan whatever name its given.

    Saman Friday, 12 June 2015 07:31 AM

    Borrowing billions to make the. masses happy. Time is now to scrap freebies like education, health and heavily subsidized fuel.

    Nims Friday, 12 June 2015 07:08 AM

    Please ask Mahendran to return the billions he robbed from CB


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