Sri Lanka to complete domestic and external debt reworking by September: President Wickremesinghe

President Ranil Wickremesinghe has said that Sri Lanka’s debt restructuring programme will be completed by September this year and its bankrupt economy will be brought to a stable level, a media report said on Monday.

Debt-ridden Sri Lanka is still struggling to normalise its crisis-hit economy after it declared its first-ever debt default in April last year.

“A country becoming bankrupt means that it is a beggar nation. None of us wants to become a beggar nation. We approached the IMF, as we have nowhere else to go,” Wickremesinghe, also the country’s finance minister, said on Sunday. He also assured that discussions on the reworking of both domestic and external debt would be completed by July or August 2023, NewsFirst Lanka reported.

Sri Lanka’s total debt is USD 83.6 billion, of which foreign debt amounts to USD 42.6 billion and domestic debt amounts to USD 42 billion.

“By the coming month of September, it is possible to successfully complete the debt restructuring programme and bring the economy to a stable level. We have submitted the agreement with the IMF to the Parliament and passed it,” the president said.”Today, members of the Sri Lanka Podujana Peramuna (SLPP) have expressed their will and given the necessary support to the economic policy of the United National Party. That support is very important if this country is to recover from the economic crisis. We should all work together and work hard to build a prosperous country out of bankruptcy,” Wickremesinghe said.

He also stressed that the cash-strapped country had no other option but to fulfil the tough conditions imposed by the International Monetary Fund (IMF).

“We have gone to the IMF and are taking the programme forward with proper management,” said the president.

Wickremesinghe also called on every Sri Lankan to contribute to creating a glorious and prosperous country free of bankruptcy.

He made these remarks while declaring open the Kegalle, Aranayaka ‘Asupini Ella water scheme’ — the largest water project in the Sabaragamuwa Province — implemented under the financial allocation of Rs. 3,847 million from the Sri Lankan government and the loan support of Rs. 18,650 million from the Netherlands.

In April 2022, Sri Lanka declared its first-ever debt default, the worst economic crisis since its independence from Britain in 1948, triggered by forex shortages that sparked public protests.

Months-long street protests led to the ouster of the then-president Gotabaya Rajapaksa in mid-July. Rajapaksa had started the IMF negotiations after refusing to tap the global lender for support.