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Debt restructuring with IMF assistance mandatory to get out of this situation - SJB
Sri Lanka will be compelled to go for a debt restructuring programme with the assistance of the IMF to get out of the present economic deadlock, an SJB MP said today.
SJB MP Dr. Harsha de Silva told a press conference that social unrest would be inevitable if the economy plunges further. “Such a situation could be avoided only if the government goes for a debt restructuring programme with the assistance of the IMF,” Dr. de Silva Said. “As per the statement made by Fitch Ratings, total foreign debt services for the next few years will be US$ 29 billion while it will have to settle US$ 4 billion each year including this year. However, Sri Lanka will be left with usable foreign reserves of US$ 3.5 billion. The debt services for this year will be US$ 3.8 billion. How Sri Lanka is going to manage this situation?” he questioned. “Sri Lanka’s expenses for salaries, pensions and interest for loans for the first quarter of this year is around Rs. 727 billion whereas the revenue has been Rs. 482 billion,” he said. “Sri Lanka will be compelled to request debt moratoriums from the debtors.” he also said. “Another issue is the currency issue which Sri Lanka suffered recently. This made the government print money. This in turn resulted in an increase of money supply. Increased money supply made the interest rates go down. This has made foreigners who invested in capital markets take their money away from Sri Lanka. There came a shortage of dollars. I don’t blame this government alone for printing money, as the previous government also did it to some extent,” he elaborated. (Yohan Perera)Comments - 9
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