Colombo, Sri Lanka President Ranil Wickremesinghe on Tuesday responded to opposition criticism of the cash-strapped country's external debt restructuring deal with major bilateral creditors and promised to submit all agreements and documents related to the debt restructuring to a parliamentary panel for scrutiny.
However, the planned two-day debate in Parliament on the agreement was postponed because opposition members protested the lack of transparency regarding the agreements reached.
Wickremesinghe dismissed opposition criticism as inaccurate, arguing: “No bilateral creditor would accept a reduction in the principal amount. “Instead, concessions are allowed through extended payment periods, grace periods, and lower interest rates.”
The president, who also holds the portfolio as finance minister, said agreements with bilateral creditors include extending principal payments until 2028, keeping interest rates below 2.1 percent and extending the total grace period for debt settlement until 2043.
Wickremesinghe said Sri Lanka's external debt now stands at $37 billion, which includes $10.6 billion in bilateral credit and $11.7 billion in multilateral credit. Commercial debt amounts to $14.7 billion, of which $12.5 billion are sovereign bonds. Debt restructuring, he said, aims to make it sustainable, freeing up funds for public services.
President Wickremesinghe said he would present all agreements and documents related to the debt restructuring to Parliament's Public Finance Committee, emphasizing the need for thorough scrutiny and wide attention to the matter, his office published in X.
He said the debt restructuring was to make it sustainable and would lead to the allocation of more funds for public services.
"The country can now obtain foreign loans and resume projects that had been stopped mid-course due to lack of foreign financing," Wickremesinghe said.
Foreign loans to Sri Lanka ceased in April 2022, when the government declared a sovereign default.
Wickremesinghe acknowledged the short-term credit assistance provided by India and Bangladesh during that period. “At that time we received help from two friendly nations, India and Bangladesh, who provided us with short-term credit assistance. No other country was allowed to give long-term loans,” he said.
Wickremesinghe assured that all debt restructuring agreements would be presented to Parliament after the conclusion of ongoing talks with sovereign bondholders.
Wickremesinghe's statement was followed by main opposition leader Sajith Premadasa, who reiterated that the government has failed to secure the best possible deal in the debt restructuring process.
However, the planned two-day debate in Parliament on the agreement was postponed because opposition members protested the lack of transparency regarding the agreements reached.
Wickremesinghe dismissed opposition criticism as inaccurate, arguing: “No bilateral creditor would accept a reduction in the principal amount. “Instead, concessions are allowed through extended payment periods, grace periods, and lower interest rates.”
The president, who also holds the portfolio as finance minister, said agreements with bilateral creditors include extending principal payments until 2028, keeping interest rates below 2.1 percent and extending the total grace period for debt settlement until 2043.
Wickremesinghe said Sri Lanka's external debt now stands at $37 billion, which includes $10.6 billion in bilateral credit and $11.7 billion in multilateral credit. Commercial debt amounts to $14.7 billion, of which $12.5 billion are sovereign bonds. Debt restructuring, he said, aims to make it sustainable, freeing up funds for public services.
President Wickremesinghe said he would present all agreements and documents related to the debt restructuring to Parliament's Public Finance Committee, emphasizing the need for thorough scrutiny and wide attention to the matter, his office published in X.
He said the debt restructuring was to make it sustainable and would lead to the allocation of more funds for public services.
"The country can now obtain foreign loans and resume projects that had been stopped mid-course due to lack of foreign financing," Wickremesinghe said.
Foreign loans to Sri Lanka ceased in April 2022, when the government declared a sovereign default.
Wickremesinghe acknowledged the short-term credit assistance provided by India and Bangladesh during that period. “At that time we received help from two friendly nations, India and Bangladesh, who provided us with short-term credit assistance. No other country was allowed to give long-term loans,” he said.
Wickremesinghe assured that all debt restructuring agreements would be presented to Parliament after the conclusion of ongoing talks with sovereign bondholders.
Wickremesinghe's statement was followed by main opposition leader Sajith Premadasa, who reiterated that the government has failed to secure the best possible deal in the debt restructuring process.
