📈 SL Rules Out 2028 Debt Default; Confident on Payment Capacity

• President Anura Kumara Disanayake, during the 2026 Budget presentation, ruled out another debt default, assuring the nation of its capacity to meet future obligations, including the payment due in 2028. • 2025 Debt Servicing Performance: • US$ 1.95 Bn in foreign debt was serviced from Jan-Sep 2025. • Only US$ 487 Mn remains out of the US$ 2.43 Bn total due for 2025. • This 2025 total is an increase of US$ 761 Mn compared to the US$ 1.67 Bn paid in 2024. • 2028 Projection: The projected foreign debt service for 2028 is US$ 3.259 Bn, which is an increase of only US$ 824 Mn compared to 2025. • Debt Restructuring Relief: Creditors agreed to a 0.75% annual interest rate reduction on Governance-Linked Bonds (GLB) (saving US$ 7.9 Mn per year from 2028-2035) if the Government meets revenue targets of 15.3% (2026) and 15.4% (2027) of GDP. • Sustainability Goal: Public debt as a percentage of GDP is projected to decline and is targeted to be below 90% by 2032.