Colombo: According to the Colombo Gazette, the resolution on Sri Lanka’s Domestic Debt Optimization was passed in parliament on Saturday with the support of some opposition MPs. The resolution received 122 votes in favour and 62 votes against. The Speaker of the Sri Lanka Parliament, Mahinda Yapa Abeywardena, informed the Parliament that the resolution was passed with amendments. Notably, opposition MPs Vadivel Suresh and Kumara Welgama and independent MPs Anura Priyadharshana Yapa and Dr. Sudharshini Fernandopulle were among those who voted for the resolution.
Earlier, the Parliament of Sri Lanka had decided to dedicate a full day of debate to the topic of Domestic Debt Optimization. The resolution had already received approval from the majority of the Committee on Public Finance (COPF). Under the chairmanship of Dr. Harsha de Silva, the committee engaged in extensive discussions on the matter, which had a significant impact on the final resolution approved by the Parliament.
Additionally, discussions were held with creditors such as banks, superannuation funds, and insurance funds. The aim was to gather insights and input from various stakeholders involved in the process of domestic debt optimization.
Sri Lanka is currently facing an economic crisis, with the Asian Development Bank (ADB) projecting a contraction in economic growth this year. The country’s economy contracted by 7.8% in 2022, and it is expected to shrink by 3% in 2023 due to challenges related to debt restructuring and balance of payments difficulties.
However, the ADB believes that reform measures, including the reversal of tax cuts implemented in 2019 and the recent approval of a loan arrangement from the International Monetary Fund (IMF), will support Sri Lanka’s efforts to stabilise its economy. The gradual financial recovery is expected to begin in 2024.
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