Country’s foreign debt jumps by Rs. 626 billion due to depreciation

Eran Wickremaratne

Sri Lanka’s total foreign debt burden had increased by over Rs 626 billion due to the depreciation of the rupee against the US dollar between January 2015 and November 2017, Parliament was told yesterday.

State Minister of Finance Eran Wickramaratne revealed this in answer to a question posed by UPFA MP Udaya Gammanpila. According to the Minister, the depreciation of the rupee during that period had added Rs 626.439 billion to the foreign debt burden.

Minister Wickramaratne noted that during the period from January 9, 2015 to November 30, 2017, the rupee had depreciated by 14.6% against the US dollar. He however rejected MP Gammanpila’s contention that the rupee had depreciated to the extent of foreign investors losing their faith in Sri Lankan Treasury Bonds in the wake of the Central Bank bond scandals.

He said that the debt burden in rupees increased anyway when one obtained foreign loans and if the rupee depreciated against the US dollar.

The problem would not arise if loans were obtained in rupees instead of US Dollars, the State Minister said.

(Source: The Island – By Saman Indrajith)