Government has capacity to meet foreign debt payments over the next two years, says President

By The Pulseline News Desk

President Anura Kumara Dissanayake has assured that the Government has sufficient liquidity and financial capacity to meet Sri Lanka’s foreign debt servicing obligations over the next two years, dismissing concerns about its ability to honour external payments.

Presenting the 2027 Budget in Parliament today (12), the President said the country’s foreign debt repayment requirements would be lower in 2027 than the amounts serviced in each of the previous two years.

According to figures presented by the President, the Government serviced US$3,707 million in foreign debt in 2025 and is required to pay US$3,591 million in 2026.

The foreign debt servicing requirement is expected to decline to US$2,986 million in 2027 before increasing to US$3,674 million in 2028.

Dissanayake said these projected requirements demonstrated that the Government could manage its external debt obligations over the coming two years.

Responding to concerns raised by certain parties about the country’s ability to meet foreign debt payments, the President maintained that the Government had the necessary financial resources and liquidity to fulfil its commitments.

He expressed confidence that Sri Lanka could continue servicing its external debt while maintaining the momentum of its economic recovery.

The figures come as Sri Lanka continues to navigate the aftermath of its sovereign debt crisis and implement its debt restructuring programme under the International Monetary Fund (IMF)-supported economic reform framework.

However, the President’s assurance comes against the backdrop of continuing pressure to strengthen foreign exchange reserves, maintain fiscal discipline and ensure that future debt servicing does not undermine the country’s economic recovery.