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A Historic Milestone for Sri Lanka: President Wickremesinghe’s Address on Debt Restructuring Achievements

President Ranil Wickremesinghe declared today as a significant day in Sri Lanka’s recent history and a pivotal moment, as the nation reached final restructuring agreements for its external debt owed to bilateral creditors.

In a special address to the nation on Wednesday evening, the President highlighted the positive outcomes of the government’s recent efforts. He announced that Sri Lanka secured a final restructuring agreement for USD 5.8 billion of debt with its bilateral lenders’ Official Creditor Committee in Paris, France.

Additionally, Sri Lanka signed debt treatment agreements with the Export-Import Bank of China (EXIM) in Beijing to restructure USD 4.2 billion of debt. The necessary formal procedures are currently being implemented.

“For those who truly love the country, this is good news. Sri Lanka won,” he proclaimed in his televised speech. President Wickremesinghe emphasized that these agreements will enhance international trust in Sri Lanka. “This is an international assurance in a certain way,” he expressed. He noted that the global community, which previously rejected Sri Lanka’s letters of credit, now provides assurances regarding the country’s credibility.

The agreements reached today will be presented in Parliament by Prime Minister Dinesh Gunawardena during a special session on July 2nd. President Wickremesinghe urged all patriotic members of Parliament to support the passage of these agreements.

He also stressed that the country cannot resolve its economic issues through strikes or threats but by collaborating to strengthen the economy. The President announced that the debt restructuring agreements will postpone all bilateral loan payments to foreign countries until 2028. Additionally, Sri Lanka will have until 2043 to repay these loans on concessional terms.

In 2022, Sri Lanka allocated 9.2% of its GDP to foreign debt payments. However, with ongoing efforts, this percentage is expected to decrease to less than 4.5% between 2027 and 2032, reflecting significant fiscal improvement. Following Sri Lanka’s official declaration of its inability to repay loans, all transactions and foreign-funded development projects were suspended. The successful debt restructuring now paves the way to resume these projects and transactions.

President Wickremesinghe expressed gratitude to all parties involved, including ministers, officials, and the majority of the people who supported the country through challenging times. He noted that as the country’s economic conditions improved, relief was provided to the people, and he emphasized that continuing on the correct path to strengthen the economy can further alleviate existing difficulties.

He concluded by stating that he accepted the challenge unconditionally when others proposed various conditions to rescue the country from its economic abyss. He expressed confidence in his ability to rebuild the economy through his experience, planned policies, commitment, and capacity to garner international support.

“While a few are trying to disrupt the country’s progress, they will one day have to face shame before their children for betraying their nation,” the President asserted.

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