📈 Three New Laws to De-Risk Private Capital by 1Q 2026

The Sri Lankan government plans to table three critical bills by March/April 2026 to formalize the growth framework and attract private capital, according to Senior Economic Adviser Duminda Hulangamuwa. • Investment Framework: New legislation will focus on investment protection, a formal Public-Private Partnership (PPP) framework, and State-Owned Enterprise (SOE) reforms to reduce policy risk and provide predictability for large-scale projects. • Fiscal Performance: Sri Lanka recorded a primary surplus of 3.9% of GDP last year, significantly exceeding the IMF benchmark of 2.3%. Official reserves grew from US$ 6 Bn to US$ 6.8 Bn by the end of 2025. • Debt Sustainability: Claims of post-2028 debt distress were rejected. Annual foreign debt servicing is projected at approximately US$ 3 Bn through 2036, a level deemed manageable given that US$ 3.2 Bn was successfully paid last year. • Sector Growth: • Tourism: Identified as a central pillar; focus shifting toward product diversification and infrastructure (airport and expressway expansion). • Shipping & Logistics: Plans include expanding port capacity and developing a dry port near Colombo to enhance transshipment operations. • SOE Reform: A new bill will establish a holding company structure to improve transparency and operational independence, with potential for partial listings. • Economic Outlook: While 4–5% growth is expected "naturally," the government is targeting higher, policy-led expansion to ensure long-term stability without resorting to money printing or tax cuts.