Sri Lanka is unlikely to face another economic crisis in 2028 despite potential uncertainties over debt repayments in 2027, as current economic indicators do not point towards a renewed crisis, Central Bank of Sri Lanka (CBSL) Director of Economic Research Dr L R C Pathberiya said on Thursday (29).

Speaking on Ada Derana’s Rebuild Sri Lanka programme, Dr Pathberiya said: “When we examine the current economic data, an economic crisis does not appear to be a major concern. We can state that such a situation will not arise in 2028. The Central Bank asserts that, even if there is uncertainty in 2027 regarding debt repayments, such a scenario will not materialise.”

Dr Pathberiya said: “The volume of credit to the private sector has increased by 27% year-on-year during 2026, compared to the previous year.”

According to CBSL data, in 2025, Sri Lanka’s total credit to the private sector achieved a record annual growth of 25.2% year-on-year.

“However, it would be inaccurate to label the private sector as 'unstable' based on this. These are not merely personal loans, but rather credit extended to the industrial, services, and agricultural sectors. So, these loans are being taken to further develop businesses,” he said.

“Considering that the economy grew by 5% last year, if the private sector had been so skeptical that it refrained from making investments, the economy would not have grown in this manner,” he said.

“Forward-looking economic indicators also point towards continued growth. While there was a slowdown in growth during the second quarter of 2026, partly due to the conflict in the Middle East, an examination of these economic indicators suggests that the economy is undergoing a phase of expansion,” Dr Pathberiya said.

“However, given the current global situation, there remains a degree of instability, or perhaps a sense of uncertainty. This primarily stems from geopolitical conditions, as well as international trade, with Sri Lanka also exposed to external economic changes as an island nation,” he said.