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President calls on creditors’ support for debt sustainability

  • Addresses 55th ADB Governor’s Meeting

It is the hope and expectation of Sri Lanka that the island nation’s creditors and all stakeholders will support to restore debt sustainability and help put the country back on the path of inclusive and sustainable economic growth, said President Ranil Wickremesinghe, addressing the 55th Annual Meeting of the Asian Development Bank (ADB) Board of Governors in the Philippines last morning (29).

Addressing the meeting, President Wickremesinghe said that amidst major economic stress, Sri Lanka is undertaking an unprecedented fiscal effort as part of the Government’s commitment to restoring the country’s debt sustainability. 

“Amidst major economic stress, Sri Lanka is undertaking an unprecedented fiscal effort as part of our commitment to restoring the country’s debt sustainability. It is our hope and expectation that Sri Lanka’s creditors, and all stakeholders, will support us in these efforts to restore our debt sustainability and help put the country back on the path of inclusive and sustainable economic growth,” he said.

Therefore, he expressed hope and expectation that Sri Lanka’s creditors, and all stakeholders, will support Sri Lanka in these efforts to restore the country’s debt sustainability and help put the country back on the path of inclusive and sustainable economic growth. 

The President noted that the Government has already undertaken major macroeconomic policy reform measures and this programme is aligned with the commitment of the Government to implement an ambitious and comprehensive package of reforms. He stated that these reforms will help restore the sustainability of the country’s public finances, addressing external imbalances, and restarting the growth engine through structural reforms and improvements in governance. 

The President further said that whilst Sri Lanka undertakes these deep and often painful reforms, the country is experiencing rising unemployment and reduction in purchasing power of the consumers. 

He added that the Government is cognisant of the adverse impacts on the most vulnerable members of society, adding that every effort has been taken to allocate greater financing and resources towards targeted support for social protection.

He assured that the Government has stabilised Sri Lanka’s economy and that many countries and stakeholders are keenly monitoring how they resolve this crisis. Wickremesinghe said that his Government is well aware that the evolution of Sri Lanka’s economic crisis includes both domestic policy elements as well as external shocks, adding that the resolution of the crisis also requires both domestic efforts and the support of external partners. 

“It is incumbent upon Sri Lanka and our creditors and partners to set an example of how collaborative and good faith action can result in sustainable and equitable solutions to sovereign debt issues.”

However, he emphasised that the economic levers alone are insufficient to stimulate global economic recovery. Adding that the factors underlying the main crisis are not only of economic origin, the President said they are also the consequences of evolving geopolitics. 

He noted that as this global rivalry intensifies into a new cold war, which will determine a new global power balance by 2050, the inability of the major countries to give leadership to the mitigation of the global climate change crisis is becoming more apparent.

“As they say in many of our countries, when the elephants fight, it is the grass that is crushed. This is the predicament of many of our member countries. Therefore, we must overcome the geopolitical rivalries to address the major threats to our existence, otherwise we will all fail leading to instability in our region reminiscent of Europe after World War I. On the other hand, our ability to successfully meet these challenges will lead to remarkable progress in raising the living standards of our people through the rise of the economies of our member countries.” 

Hence, President Wickremesinghe said that the ADB’s Strategy 2030 seeks to respond to global challenges, including climate change and natural disasters, food and energy insecurity, whilst also embracing opportunities in the digital economy, sustainable energy, and leveraging technology for inclusive education and healthcare. 

Thus, he said that the ADB has a crucial role in helping to shape and finance policies that improve people’s lives and livelihoods across Asia and the Pacific.

The annual meeting of the ADB Board of Governors was held last morning (29) at the ADB headquarters in Manila, Philippines and attended by Governors and official government delegations. 

The President left for the Philippines on Wednesday (28) evening after concluding his official two-day state visit to Japan.

While in the Philippines, he was scheduled to meet and hold talks with Asian Development Bank (ADB) President Masatsugu Asakawa.

President Wickremesinghe also engaged in bilateral talks with his counterpart, President Ferdinand Romualdez Marcos Jr. at the Malacanang Palace in Manila last morning.

He told his Filipino counterpart that the long-standing friendship between Sri Lanka and the Philippines would be promoted by developing Asian regional cooperation.

During this discussion, greater emphasis was placed on further strengthening the longstanding bilateral relations between Sri Lanka and the Philippines through new approaches.