📈 Urgent MLB Buy-Back Urged to Save Up to US$ 400 Mn

SJB MP Dr. Harsha de Silva has urged the Government to proactively buy back Sri Lanka’s Macro-Linked Bonds (MLBs) before markets reprice them. Total payouts on MLBs are projected to rise from US$ 6.2 Bn to US$ 7.4 Bn over 10 years as GDP growth exceeds IMF forecasts. • Bond Buy-Back Strategy: Proactive action using the 2018 Liability Management Act could save US$ 300 Mn – US$ 400 Mn over a decade. • Debt & Fiscal Performance: Public debt-to-GDP dropped from 121% (2022) to 98% (end-2025), projected to hit ~93%, mainly due to past reforms. Interest payments absorb ~41% of revenue, with external debt service rising to ~US$ 4 Bn/yr by 2030. • Low Execution & One-Off Gains: Capital expenditure execution reached just 26% from Jan-Aug 2026. Revenue gains relied heavily on pent-up vehicle import demand, accounting for Rs. 900 Bn (63%) of the Rs. 1.4 Tn increase in 2025. • Thin Foreign Inflows: 1H 2026 multilateral disbursements (excl. IMF) totaled US$ 177 Mn (World Bank: US$ 94 Mn, ADB: US$ 52 Mn), while bilateral inflows stood at a low US$ 24 Mn (Japan: US$ 14 Mn, India: US$ 8 Mn). IMF disbursed US$ 619 Mn. • Reserves & Market Access: CBSL dollar purchases slowed from ~US$ 600 Mn in August to US$ 65 Mn in September. Despite a Fitch upgrade to 'B-', further credit rating improvements require policy consistency and sustained reserve accumulation.