Sri Lanka faces severe debt burden

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Sri Lanka’s debt burden will be 115% of GDP by the end of 2021, the World Bank forecasts on its economic growth in the South Asian region report.

The amount of loans obtained by the Government of Sri Lanka from banks increased by 63% in January 2021 and the amount of loans extended to the Government by the Central Bank of Sri Lanka increased by 176%, it said.

It also states that the amount of Treasury bills purchased or printed by the Central Bank of Sri Lanka as of February 28 is Rs. 810 billion.

However, Sri Lanka’s economic growth is expected to recover to 3.3 percent in 2021, and 2.2 percent in 2022 after contracting 6.7 percent in 2020, the World Bank said in a January 2021 on its report.

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