Opposition Leader Sajith Premadasa yesterday (08) said that the NPP government should make a serious effort to renegotiate repayment plan in terms of Sri Lanka’s USD 3 bn deal with the International Monetary Fund (IMF) as the country couldn’t, under any circumstances, resume debt repayment in 2028.
MP Premadasa warned that the country was at serious risk of default again. Even if the outcome of the presidential and parliamentary polls had been different the situation would have been the same, Premadasa told The Island, urging President Anura Kumara Dissanayake to revisit the issues at hand without further delay.
Responding to queries regarding the SJB’s response to the developing situation, MP Premadasa said that during last Friday’s sittings he had unreservedly offered the SJB’s backing for NPP’s efforts to renegotiate the deal. “We expect a positive response from President Dissanayake,” he said.
Having polled 1.9 mn votes at the general election held on Nov. 14, the SJB obtained 40 seats whereas the NPP secured an unprecedented 2/3 majority by winning 159 seats.
MP Premadasa told Parliament that the NPP, soon after having secured big wins at the presidential and general polls, had betrayed the country by reaching a consensus with the IMF on the latter’s terms.
Urging the government to reveal its agreement with the IMF in Parliament before 12 Dec., MP Premadasa assured the Opposition’s unconditional support for the government while suggesting the NPP government follow Ghana in addressing debt restructuring or face the consequences.
The SJB leader was referring to the IMF and Ghana recently reaching an agreement in respect of the Extended Credit Facility arrangement on their third review of the West African country’s $3 billion IMF loan programme.
Former Minister Premadasa also questioned whether the recently concluded agreement with the IMF had been formulated in terms of a new understanding between the lending agency and the government or in accordance with the deal finalized during Ranil Wickremesinghe’s presidency.
The Opposition Leader said that the NPP couldn’t meet the expectations of the people if its government remained committed to the existing agreement with the IMF. During the tail-end of Wickremesinghe’s presidency, the Parliament passed the much-discussed Economic Transformation Bill without a vote. The new Act is meant to ensure, regardless of change of government, Sri Lanka remains committed to the original agreement with the IMF.
In terms of the Extended Fund Facility offered to Sri Lanka, the country can receive USD 3 bn over a period of four years.
MP Premadasa found fault with the government for having reached an agreement to resume debt repayment in 2028 though the IMF had given Sri Lanka time till 2033. Sri Lanka in April 2022 announced suspension of debt repayment pending talks with lenders.
Declaring that the IMF agreement touted as a panacea by Wickremesinghe and Dissanayake for all economic ills of Sri Lanka, Premadasa warned the incumbent President that the latter was on a dangerous path.
Comparing the debt-restructuring process undertaken by Ghana and Sri Lanka, the SJB leader claimed that in spite of the firm that handled ISBs (International Sovereign Bonds) also involved in the Ghanaian process the outcome seemed to be very much different.
Sri Lanka would have to pay a very heavy price for agreeing to, what he called, an unfair agreement only to secure extended fund facility at any cost, the Opposition leader said. According to him, the country could end up in a far worse situation if the NPP went ahead with the existing arrangement at the expense of all other sectors, including education, health, fisheries and agriculture.
Asserting that taking an extremist position on the economy could be quite harmful, Premadasa urged the government to adopt the middle path.
The Opposition leader also drew the government’s attention to the end of the suspension of parate executions on Dec 15. He urged the government to take appropriate measures regarding the matter that attracted quote a lot public attention in the past. (SF)
