Sri Lanka forex debt owed to non-residents only US$3.7bn in 2021: CB Governor
ECONOMYNEXT – Sri Lanka has to repay only 3.7 billion dollars to holders of external debt in 2021 and the balance is held by resident holders, moreover, 1.1 billion dollars had already been paid, Central Bank Governor W D Lakshman said.
Some of the debt was denominated in debt but was owed to domestic holders.
They included Sri Lanka Development Bonds, borrowing from offshore banking units and also some international sovereign bonds were held by domestic holders he said, as foreigners exited.
A certain volume of ISBs transferred to locals are treated as” foreign currency-denominated domestic debt,” Governor Lakshman said.
“Of this 3,709 million already 1,103 million has been repaid January and February 2020,” Governor Lakshman told an online forum organized by Veemansa, a Colombo-based think tank.
Sri Lanka’s cabinet spokesman Minister Udaya Gammapila said earlier this year that 6,865 in dollar debt had to be repaid in 2021.
Governor Lakshman said during the rest of 2021, an external debt service of 3,127 dollars remained.
He said the billion US dollar bond coming up for payment in 2021 would be repaid and the country would maintain its unblemished debt repayment record.
There are market estimates that domestic holdings of the billion-dollar bond could be as much as 250 to 300 million dollars.
Sri Lanka had imposed surrender requirements on export proceeds and remittances and the central bank was buying dollars he said.
Sri Lanka was using ‘alternative’ strategies involving import controls to create ‘austerity’ he said.
Sri Lanka had to repay around 4.0 billion US dollars in foreign debt each yeare from 2022 to 2025 and it fell below 4.0 billion from 2026, he said. (Colombo/Dec24/2021)