Therefore, the minister stressed that the time has come for all citizens to support the continuation of the current economic program.
The Minister of Transport, Highways, and Mass Media, Dr. Bandula Gunawardena, made this statement during a news conference at the Presidential Media Centre (PMC) today (01), under the theme ‘Collective Path to a Stable Country’.
The Minister further commented:
A special debate on foreign debt restructuring will be held in Parliament on July 2 and 3. In the past, the Treasury lacked dollar reserves, making it impossible to pay debt instalments. There were shortages of fuel and gas, leading to long queues. Society became filled with hatred, and the entire country was overcome with turmoil.
At a time when no one else stepped forward to take charge, President Ranil Wickremesinghe, with his extensive experience as a Prime Minister and seasoned politician, accepted the challenge and initiated a program to stabilize the country. His first action was to approach the International Monetary Fund (IMF) and negotiate a comprehensive loan agreement, making significant efforts to ensure its success. Although the country had previously approached the IMF 16 times, President Wickremesinghe had to personally undertake energetic efforts to secure the loan facility.
As a result, a comprehensive loan agreement with the International Monetary Fund was secured, extending until the year 2027. Under this agreement, our country began to rely heavily on these loans. Given our reliance on imports and our lack of self-sufficiency, it’s imperative to maintain international trade relationships for goods. Regardless of the political leadership, these deals hinge on international recognition and adherence to global norms. Thanks to the comprehensive credit facility agreement, we secured annual imports until 2027.
Looking ahead, the budget for 2025 must be drafted in the coming months. Approval of this budget is crucial for disbursing salaries to public servants, pensions for senior citizens, and social welfare benefits like Samurdhi and Aswasuma to the needy. Without the support of the International Monetary Fund, a budget cannot be prepared beyond 2027.
The International Monetary Fund will provide US $700 million for the 2025 budget, with an additional US $400 million from the World Bank (WB) and US $300 million from the Asian Development Bank (ADB). It is anticipated that another US $3,655 million will be received as debt relief when preparing the budget document for next year. This funding structure is essential for meeting obligations such as salaries, pensions, and subsidies for public servants, regardless of the governing administration.
These debt relief projections are speculative and extend into 2027. By that year, despite efforts to minimize budget gaps, a deficit of US $3,911 million is forecasted. Under the comprehensive credit facility, US $629 million, including US $600 million from the International Monetary Fund, US $300 million from the World Bank, and US $300 million from the Asian Development Bank, are allocated for budget preparation. Nonetheless, there remains a shortfall of US $1.5 billion to prepare the 2027 budget.
To cover this deficit, our country must access the international market. Presently, global market conditions restrict the issuance of Sri Lanka’s sovereign bonds, which can only be pursued in 2027. To issue such bonds successfully, our foreign reserves need to reach US $14 billion by that time, a target that currently stands at US $5.5 billion. Despite these challenges, a structured annual program has been developed to address these financial requirements.
While the government is implementing such a program, the President is making agreements with foreign countries. There is no hidden agreement or program. The President has also presented all the information to the Parliament.
In that context, no one can run a government apart from this prepared economic program. It must be said that if someone dreams of governing outside of this economic program, the country cannot be prevented from collapsing again.
Therefore, we need everyone’s support as a country to continue implementing these agreed programs to create an environment where the unborn children who love this country can rise as a nation and live in a developed country. Also, it must be said that if anyone opposes the debate in the Parliament regarding the extended credit facility, they will go down in history as traitors.
