Opposition Leader Mahinda Rajapaksa said yesterday the incumbent government was the most irresponsible when it came to handling finances and that it had thrown government money into political endeavours to win elections and retain power.
In a statement, he said the Rajapaksa government took loans for investment whereas the Yahapalana government took loans to meet its day to day expenses.
“The reason why my government did not have to take foreign currency loans for consumption while the yahapalana government had to do so, is because the latter threw government money into political endeavours to win elections and to retain power,” he said. "The debt crisis created in this country by the yahapalana government has now reached a critical stage. The total government debt was Rs. 7.39 trillion at the time this government came into power in January 2015, had skyrocketed to Rs. 12.64 trillion by the end of July 2019 – an increase of 71%. The high proportion of foreign currency commercial loans in the debt taken by the yahapalana government increases the risk to the country. The international rating agency Moody’s issued a warning recently with regard to this matter. From January 2015 to date, this government has taken a staggering 26 billion US Dollars in foreign currency commercial loans through Sri Lanka Development Bonds, Sovereign Bonds, Syndicated Loans, Currency Swaps and the like."
Mr. Rajapaksa said foreign currency loans have to be repaid in foreign currency and the debt burden increases automatically when the value of the US Dollar increases in relation to the Rupee.
"The value of the US Dollar which was Rs.131 when this government came into power, has increased to Rs.183 today. The depreciation of the currency from 2015 up to the end of 2018 alone, had increased the government’s debt burden by Rs.1,709 billion. The most salient feature of the debt that the present government has taken on, is that none of it has been utilised to develop the country but only to meet the day to day expenses of the government.
"Whenever the yahapalana camp refers to the debt taken on by my government, they refer only to various project loans that we took to build infrastructure. It should be noted that during the past five years, the yahapalana camp has never referred to any debt taken by my government which was not related to a project. The reason for this is that it was very sparingly that my government took commercial loans through Sri Lankan development bonds, sovereign bonds, currency swaps or syndicated loans. The project loans taken during my time were long term loans taken at concessionary rates of interest. Furthermore, the amounts that we took as project loans are very small in comparison to the yahapalana consumption borrowings.
"The cost of the Norochholai Power Plant was 1.35 billion USD. The entire loan taken to build the Hambantota harbour was 1.26 billion USD. The expressway up to Matara cost 740 million USD, the Mattala Airport 209 million USD, the Colombo Katunayake Expressway 292 million USD and the loan taken to build the Lotus Tower was 67 million USD. Even if the loans taken to build all these projects are put together, the amount taken does not come even close to the 4.4 billion USD that the yahapalana government borrowed in 2019 alone through the issue of two sovereign bonds.
"That would place in perspective the proportions of the debt crisis created by the yahapalana government in less than five years. This is why I have kept the public informed about this issue from time to time. My government took loans for investment. Today the Norochcholai Power Plant is a very profitable enterprise. The Auditor-General stated last year that the expressways are also making profits. Last Sunday, the newspapers reported that the nine-story administrative building of the Hambantota Port has a 95% occupancy rate with companies engaged in various operations related to the port renting space in the building. This means that before long the Hambantota Port will also be making profits. The government can also derive a large income from the Lotus Tower which was opened recently.
"In contrast to this, the yahapalana government has not built anything of lasting value or anything that would generate an income from the staggering 26 billion USD that they took in the form of foreign currency commercial loans since January 2015. The reason why my government did not have to take foreign currency loans for consumption while the yahapalana government has had to do so, is because the latter threw government money into political endeavours to win elections and to retain power. The money spent by the yahapalana government to keep themselves in power will finally have to be paid by the people of this country. Economic crises have occurred under previous governments as well. However, this is the first time that an economic crisis has come about due to the mismanagement of state funds. Never in the 71 years since independence have we had a government that has been as irresponsible as this in the handling of government finances," Mr. Rajapaksa said in his statement.
Dulitha Wednesday, 02 October 2019 05:02 AM
Talking about financial irresponsibilties now what can we say
ra Wednesday, 02 October 2019 05:15 AM
yes. the government is also handling accused war criminals irresponsibly by ignoring international laws
Lakminiha Wednesday, 02 October 2019 05:41 AM
Look who's talking
ANTON Wednesday, 02 October 2019 05:55 AM
So Mahinda up to what extent you are hoping to lose your respect? Take retirement.
American singhalaya Wednesday, 02 October 2019 06:09 AM
So did you and your family as well .
Cobra Wednesday, 02 October 2019 06:12 AM
Is the responsible manner pertaining to filling your pockets????
ranjit Wednesday, 02 October 2019 06:24 AM
you handle it well during your time by keeping it in your family
ara Wednesday, 02 October 2019 06:40 AM
Sumal Wednesday, 02 October 2019 06:46 AM
Yes we paid petrol 175/- per litre, domestic gas 3500/- during your time
Ralahamy Wednesday, 02 October 2019 06:56 AM
The consolation is you are the Great GURU to Ranil and he is following your footsteps. You forgot to mention the Mihin Lanka Bond of several billions, that got dissolved along with your airline.
Borat Wednesday, 02 October 2019 07:04 AM
Sir you know too well as it really should have been siphoned to your family
Sunil Wednesday, 02 October 2019 07:12 AM
Irresponsible is not the word, Sir. They acted downright foolishly for their own good.
Hoodwinker Wednesday, 02 October 2019 07:26 AM
Look who's talking now
Raspi Wednesday, 02 October 2019 07:29 AM
He should probably go and look in to the mirror. This guys seems to have woken up from a coma or something.
"IN SHORE" Wednesday, 02 October 2019 07:30 AM
At Least the finances are with the government to handle - and not off shore
Zulkifli Nazim Wednesday, 02 October 2019 07:31 AM
The pot calling the kettle black
Jude Wednesday, 02 October 2019 07:51 AM
Look who's talking!!!! MR Regime lived off Souverign Bonds and all kinds of borrowing!!!
Pick Pocket Wednesday, 02 October 2019 08:06 AM
He pocketed LKR 125 m. of tsunami funds and of course returned it later!!!!
Shayan Wednesday, 02 October 2019 08:15 AM
What a joke. Like you managed finances brilliantly. Hypocrite
BuffaloaCitizen Wednesday, 02 October 2019 11:04 AM
Ha Ha I don't know whether to laugh or cry.
roland boniface Wednesday, 02 October 2019 06:56 PM
HOW ABOUT HEDGING and the price the masses paid for petroleum products because of that.
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