Two deputy ministers pushed back on Wednesday against warnings that Sri Lanka faces a renewed debt crisis, arguing that foreign reserves have been rebuilt faster than projected even while the country resumed vehicle imports and kept up debt repayments.
Deputy Minister Chathuranga Abeysinghe rejected former President Ranil Wickremesinghe’s warning that the country could face another economic crisis after 2028, saying there was no reason for Sri Lanka to become bankrupt again.
Abeysinghe said Sri Lanka paid about US$3.9 billion in debt obligations in 2025 and expects to pay roughly US$3.7 billion in 2026, with repayments falling to around US$2.7 billion in 2027. Reserves are expected to reach about US$8 billion by the end of 2026, he said, and figures the Central Bank has presented to investors show the country can service its debt while strengthening its reserve position.
He accused Wickremesinghe of presenting a misleading picture, and said remittances, exports, investment and tourism earnings are all expected to rise this year. “These figures show that there is no reason for Sri Lanka to become bankrupt again,” he said.
Wickremesinghe had argued that repayments become significantly harder after 2028 and that reserves would need to reach about US$15 billion, questioning how the additional US$7 billion would be found.
Vehicle imports absorbed $3.5bn in LCs
Separately, Deputy Minister of Finance and Planning Dr. Anil Jayantha Fernando said reserves had been built while import restrictions were eased, telling NewsFirst that letters of credit worth around US$3.5 billion have now been opened for vehicle imports, after no allocation was made for them in 2022 and 2023.
“If those imports had not been permitted, our reserves would have been higher by that amount,” he said.
He said Sri Lanka has repaid US$2.6 billion in debt and still holds reserves of around US$6.6 billion — broadly in line with the US$6.59 billion the Central Bank reported for July — while also releasing foreign currency for imports. Fuel purchases remain a continuing drain, he added.
Anil Jayantha said the IMF had revised down the reserve targets originally set for Sri Lanka in 2023 because of the steps taken and the way reserves were released to support economic activity.
“Foreign reserves are a safeguard, not the only yardstick used to measure an economy,” he said. “We are building this buffer while keeping economic activity alive and without stifling growth.” He said the key measure is growth in net foreign reserves.
