Sri Lanka will not face another bankruptcy in 2028: Deputy Minister Anil Jayantha
20-Aug-2026.
The data and arguments put forward by former President Ranil Wickremesinghe alleging that Sri Lanka would once again face bankruptcy by 2028 are misleading and technically incorrect, Deputy Minister of Finance and Planning Anil Jayantha Fernando has said.
He made these remarks at a special media briefing held in Colombo.
He further said:
Foreign reserves are not funds used solely for servicing debt. They serve as a safeguard that enables the country to maintain imports and keep the overall economy functioning smoothly.
While vehicle imports were completely suspended under the previous administration, the present Government has permitted vehicle imports while continuing the debt restructuring process in an orderly manner. If letters of credit for vehicle imports had not been opened, the country's foreign reserves at the end of June would have increased by a further US$3.5 billion from the existing US$6.5 billion, easily exceeding the stipulated target.
Despite global challenges such as tensions in the Middle East and rising international fuel prices, Sri Lanka currently has firm foreign reserves of US$6.5 billion. The Government's main target is to increase these reserves to US$8 billion within the next six months. As Sri Lanka will have to repay a maximum of US$3.8 billion annually between 2027 and 2029, the current level of reserves will be sufficient for the country's requirements and debt servicing.
Dollar inflows have been secured through several channels to achieve the Government's target of US$8 billion in reserves. An additional US$900 million is expected to be added to the country's current account over the next six months. Furthermore, more than US$1 billion in financing is expected from international development agencies, including the International Monetary Fund's US$350 million tranche scheduled for December. In addition, a further US$1 billion in foreign direct investment is expected through the Board of Investment and the Colombo Port City projects.
During the previous administration, the banking system's net foreign assets were in negative territory. However, under the present Government, June data show that the banking system's foreign assets have recorded a positive position of Rs.1,265 billion, equivalent to approximately US$3.8 billion.
International financial institutions have positively assessed Sri Lanka's economic growth due to transparency in debt management and sound economic management. Therefore, the public and investors need not have any undue concerns about the country's economy or its capacity to service debt, he said.
