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Sri Lanka claims the country is ‘economically stable’ as government pleads for debt rollover

Sri Lanka’s Ministry of Finance has praised the Rajapaksa administration for its handling of the COVID-19 pandemic and building economic stability in the country as government spokesman, Udaya Gammanpila, pleaded with international investors to roll over bonds maturing this year.

Gammanpila stated that capital and interest repayments on foreign debt this year alone was $6.86 billion. This follows downgrades from international rating agencies questioning Sri Lanka’s creditworthiness and ability to repay debt.

According to official data from August, China owns approximately 10 % of Sri Lanka’s foreign debt.

The Agence France-Presse (AFP) reported that in 2020, the Sri Lankan economy contracted 3.9 %, “its worst-ever slump”.

Sri Lanka has responded by imposing restrictions on foreign exchange and banned non-essential imports, including most vehicles. The AFP further reports that in October the government reported close to 50,000 cases of COVID-19, 3,300 from October, and 240 deaths.

Boram Jang, Legal Advisor at the International Commission of Jurists Asia & the Pacific Programme. has criticised the government's militarised response to the pandemic stating:

Sri Lanka’s involvement of the military at every level, with limited parliamentary and civilian oversight, raises serious human rights and rule of law concerns".

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