Sri Lanka needs to pay over 2.6 billion U.S. dollars to foreign parties in 2023 in loan repayments and interest, Cabinet spokesman Bandula Gunawardena told reporters on Tuesday. Addressing a press conference, Gunawardena said around 2.1 billion dollars will be spent on debt repayment and 504 million dollars will be spent on paying interest.
Sri Lanka continued to repay loans from several multilateral organizations including the World Bank and Asian Development Bank, after it suspended paying the bilateral foreign debt in April 2022, Gunawardena said. The secretary to the Ministry of Finance informed the cabinet that while the negotiations with the International Monetary Fund (IMF) are in the last stages, the deal has not been finalized, and the government should be very careful in managing its money, Gunawardena said.
According to the 2023 appropriation bill, the country’s debt ceiling is 4,979 billion rupees (about 13.7 billion U.S. dollars), Gunawardena said, adding that the secretary to the Ministry of Finance was instructed to borrow, based on the debt ceiling, to meet the shortfall. Sri Lanka is facing its worst financial crisis since independence and in April 2022 announced the suspension of foreign debt repayments. Sri Lanka is currently negotiating a 2.9 billion dollar rescue package from the IMF.
