Govt. still undecided about domestic debt restructuring methods

By Saman Indrajith

State Minister of Finance Ranjith Siyambalapitiya told Parliament on Tuesday that compelling creditors to take a haircut was not the only way to restructure domestic debt.

Measures such as debt moratoria, reductions in interests and delayed payments could also be adopted to restructure domestic debt, Siyambalapitiya said.

“We have not decided to give domestic lenders a haircut. We also would like to assure that the EPF, the ETF and pension funds won’t be affected by domestic debt restructuring,” he said.

Earlier, SJB MP Nalin Bandara said initially the government had changed its stance on domestic debt restructuring several times.

“The government insisted that there would not be any domestic debt restructuring, but now it says it has not decided how domestic debt will be restructured,” he said.

“The government has told the IMF that it is ready to restructure domestic debt. We are opposed to restructuring domestic debt. If this happens, the EPF will be badly affected and that in turn would have a terrible impact on private sector workers. There are many people who have deposited their pensions in banks and live off interests. If the government restructures domestic debt, it will have a terrible impact. We urge the government to talk to the IMF and renegotiate the agreement to restructure domestic debt,” he said.