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Debt restructure a pivotal achievement but more ground to cover says experts

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PMD circulates views of Murtaza Jafferjee and Prof. Sirimal Abeyratne

Sri Lanka’s announcement of reaching agreements in principle to restructure approximately USD 17.5 billion of external commercial debt is a pivotal step towards achieving debt sustainability, according to Murtaza Jafferjee, Chairman of the Advocata Institute and CEO of JB Securities.

A release issued from the President’s Media Division (PMD) said: Speaking on the significance of this development, Jafferjee highlighted the long journey toward this moment and its potential to shift the country’s economic trajectory.

Reflecting on Sri Lanka’s financial situation, Jafferjee explained that as early as 2020, it was evident to him that the nation was facing a solvency crisis, rather than a liquidity issue, as many policymakers suggested at the time. Despite his warnings and public analysis advocating for debt renegotiation, it wasn’t until April 2022 that Sri Lanka initiated the process of debt restructuring.

“This is the culmination of a long process,” Jafferjee remarked, emphasizing the importance of the agreement with commercial creditors. However, he pointed out that the announcement is not the end of the road. “We are still in a selective default rating, and it will take months to finalize the process. Only then can we hope to see a rating upgrade, ideally to around triple C,” he said, underlining the significance of achieving an investable credit rating for the nation’s future economic prospects.

Jafferjee also explained the intricacies of debt sustainability analysis (DSA), a methodology used to assess the ability of a country to manage its debt. He detailed the variables that influence the analysis, such as debt-to-GDP ratios and gross financing needs. According to him, the International Monetary Fund’s (IMF) analysis forms the basis for determining whether Sri Lanka’s debt is sustainable, and if it is not, restructuring is necessary.

Jafferjee warned against delaying the restructuring process, noting that further delays would result in continued high-interest rates on Sri Lanka’s international sovereign bonds, which are currently around 6.5% to 7%. “The new interest rate is closer to 3%, so any delays in finalizing this deal are costly,” he added.

Looking forward, Jafferjee highlighted that while this agreement is crucial, Sri Lanka must focus on enhancing its debt-carrying capacity by 2028, when a significant portion of the restructured debt will begin to mature. He emphasized the importance of increasing economic growth and attracting productivity-enhancing investments to prevent future defaults.

In conclusion, Jafferjee stressed the need for Sri Lanka to improve its international standing and rebuild confidence among investors. “What has been achieved yesterday is a huge game changer in the path to debt sustainability. It is crucial to move forward, grow the economy, and restore Sri Lanka’s credibility on the global stage. If we succeed, we can emerge from this crisis stronger,” he stated.

This breakthrough marks a significant moment for Sri Lanka as it navigates its way out of a severe economic crisis, with hopes that these efforts will spark the much-needed recovery in both investment and business sentiment.

Meanwhile, Senior Professor of Economics at the University of Colombo, Sirimal Abeyratne, stated that the debt restructuring agreement reached on September 18 marks a significant milestone for Sri Lanka’s economy.

Professor Abeyratne highlighted that this agreement will remove the long-standing restrictions on Sri Lanka’s access to international capital markets, stabilize the country’s exchange rates, and strengthen the Central Bank’s foreign reserves. Additionally, the deal will lay the foundation for improving the nation’s downgraded international credit ratings.

He further commented: “Over the past two years, we have been striving to achieve economic stability and debt sustainability. The news we received on September 19th is a significant milestone toward concluding our country’s debt restructuring, particularly with the agreement reached with commercial creditors.

This marks an important turning point in Sri Lanka’s economic history. Through this agreement, we are taking a major step forward in ending the country’s bankruptcy. Restrictions on Sri Lanka’s access to capital markets will now be lifted, giving us the necessary strength to stabilize both our exchange rates and the foreign reserves of the Central Bank. Moreover, the groundwork is being laid to restore the international rankings that had declined. Given these developments, it is clear how critical it is to finalize the debt restructuring process.

However, this is only the beginning. We face several more challenges ahead. It is essential to maintain the economic stability and debt sustainability we have begun to establish. According to the debt sustainability framework we have agreed upon with the International Monetary Fund, by 2030, we aim to significantly reduce our debt burden, lower the amount of new debt, and enhance our capacity to repay foreign loans.

We have until 2032 to achieve these targets, but the work must extend beyond that. Sustainable debt management and the prevention of future economic crises can only be secured through continuous economic growth.

The people of our country have made tremendous sacrifices to support these efforts, and as Sri Lanka’s economic growth gains momentum, the pressure on them will begin to ease. To ensure lasting prosperity, we need to maintain an annual growth rate of 7% to 8% for at least 10 to 20 years. Without this sustained growth, we risk facing another period of economic instability.”



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The Government is taking steps to regulate early childhood education to ensure quality education while enhancing the professionalism of preschool teachers. — PM

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Prime Minister Dr. Harini Amarasuriya stated that the Government is taking steps to maintain early childhood education within an appropriate regulatory framework, while ensuring quality education by enhancing the professionalism of preschool teachers.

The Prime Minister made these remarks while participating in the awareness programme for preschool teachers of the Puttalam District on the National Early Childhood Education Curriculum Framework, held under the theme “A Safe World for Children, A Creative Future Generation” on Friday [16th of January] at the Sudasuna Hall in Chilaw.

The Prime Minister stated,

“The main objective of our government in 2024 was to bring about a transformative change in this country. We bear a major responsibility in achieving that transformation. When we assumed office, one of our primary responsibilities was to build a stable and resilient economy. However, I believe that with equal responsibility and commitment, our government has prioritized creating a transformative change in the education system of the country. We assumed office with that objective in mind. The discussions within our party and political movement on the necessary changes in education did not begin recently. They are the result of a long-standing process.

This transformation cannot be achieved overnight or within a single year. It is a step-by-step process. When implementing this decisive and qualitative change within the education system, it is essential to consider the system as a whole. We made this intervention by examining every stage of a child’s educational journey. Therefore, we have recognized early childhood education, from age one to age five, as an integral part of education and development.

Thereby, Early childhood development is viewed as the very first step of our education structure. At present, early childhood education exists in an unregulated manner. Our aim is to develop this early childhood education in an organized and systematic way, while enhancing the professionalism of teachers and ensuring quality education within an appropriate regulatory framework.

Accordingly, the Ministry of Women and Child Affairs and the Ministry of Education have jointly appointed a committee and initiated discussions to formulate a policy and curriculum framework for early childhood education. During the past year, we developed the preschool curriculum framework. We are working towards implementing a unified curriculum across all preschools in a structured manner. It is essential to integrate early childhood development with primary, secondary, and university education. Early childhood development is one of the most critical stages of an individual’s life. The responsibility of socializing the child, introducing them to society in a structured manner, and nurturing a disciplined, empathetic individual lies with you. This is not something that can be achieved at the primary level or beyond.

There is a common criticism that children are not taught letters and numbers at preschool. However, early childhood development is not about formal schooling. It is about helping children to develop their social skills.

It is also an objective of our government to ensure that both preschools and schools become places where parents can confidently leave their children, knowing they are safe.

We are aware of the issues relating to your allowances and pensions. Discussions have been held in this regard between the Ministry of Education and the Ministry of Women and Child Affairs. Granting due recognition to preschool certificates during school admissions is also very important, and the government’s attention has been drawn to all these matters”.

The event was attended by Minister of Public Administration, Provincial Councils and Local Government prof. Chandan Abayarathna; Members of Parliament Gayan Janaka, Hiruni Wijesinghe, and Mohamed Faisal; officials of the North Western Province Early Childhood Education Development Authority; and a large number of preschool teachers from the Puttalam District.

 

[Prime Minister’s Media Division]

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Police step up crackdown on organised crime after securing 95 Interpol Red Notices

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Police personnel accompanying a female suspect brought to Colombo yesterday

Police have stepped up their crackdown on organised crime, after securing Interpol Red Notices for 95 suspects believed to be hiding overseas.

Police Spokesman SSP F. U. Wootler told a media briefing yesterday that the move marked a major escalation in efforts to track down and extradite high-profile figures linked to organised crime syndicates and online fraud networks.

He said the strategy was already producing results. In 2024, Sri Lanka secured the return of 10 suspects through Interpol channels, while a further 11 were extradited in 2025 to face legal proceedings.

In addition to Red Notices, authorities have relied on formal legal mechanisms to overcome jurisdictional barriers. “During the 2024–2025 period, 21 suspects were extradited under the Extradition Act,” SSP Wootler said.

The briefing coincided with three more fugitives being escorted back to Sri Lanka yesterday following the issuance of Interpol Red Notices.

SSP Wootler said many of the fugitives had continued to coordinate criminal activities here from abroad, including sophisticated online scams, underscoring the importance of international cooperation.

Two male suspects, for whom Red Notices had been issued and who were overseas, and a female suspect wanted in connection with defrauding state funds, were flown back.

Following their arrival yesterday morning at Katunayake Airport, they were taken into custody by a team of officers from the CID.

The arrested suspects are residents of Kandana and Uragasmanhandiya, aged 30 and 52, respectively. The female suspect is a 56-year-old resident of Mount Lavinia.

The suspect residing in Kandana is an individual wanted in connection with an attempted murder. It has been revealed that while overseas, he is connected to a range of crimes, including orchestrating a shooting incident that resulted in a homicide in the Kandana area on 2025.07.03. This suspect has been handed over to the Officer-in-Charge of the Kelaniya Division for further investigations.

The one hailing from Uragasmanhandiya is a suspect wanted in connection with carrying out homicides using sharp weapons and being involved in a series of organised crimes in the Uragasmanhandiya area. This suspect has been handed over to the Officer-in-Charge of the Elpitiya Division for further investigations.

The female suspect, residing in Mount Lavinia, who is reported to have worked at an Embassy in 2014, is an accused in a case where the Criminal Investigations Department is investigating the defrauding of state funds. She has been sentenced to imprisonment, fines, and also ordered to compensate victims by the Colombo High Court.

“These operations were carried out with the strong support of the Government of the United Arab Emirates, including Abu Dhabi International Police, Dubai Police, as well as Sri Lankan diplomatic missions,” he said.

Interpol Red Notices function as international alerts requesting law enforcement agencies worldwide to locate and provisionally arrest individuals pending extradition.

Wootler said efforts would continue to identify and pursue suspects operating from foreign jurisdictions, particularly those involved in organised and cyber-related crimes posing threats to national security.

By Norman Palihawadane and Hemantha Randunu

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Julie’s exit gladdens Udaya’s heart

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Gammanpila eating milk rice during yesterday’s press conference to celebrate Ambassador Chung’s departure

Leader of the Pivithuru Hela Urumaya (PHU), Udaya Gammanpila, yesterday launched a scathing attack on outgoing United States Ambassador to Sri Lanka Julie Chung, accusing her of interfering in Sri Lanka’s internal affairs and exerting undue influence over recent political developments.

Addressing a press conference in Colombo, Gammanpila said Chung’s departure, after a four-year tenure, marked a “day of national relief,” claiming her presence had been harmful to the country.

He said patriots marked the occasion by sharing kiribath (milk rice), which he described as a symbolic celebration.

Gammanpila alleged that Ambassador Chung had remained in Sri Lanka longer than the customary three-year diplomatic term because of, what he described as, her success in bringing the country under American influence. Drawing comparisons with past foreign diplomats, he claimed that Chung was the most influential envoy since Indian High Commissioner J.N. Dixit in the 1980s. He alleged that successive Sri Lankan governments had failed to challenge what he described as interference by the envoy.

The PHU leader accused Chung of playing a behind-the-scenes role in the 2022 protest movement, commonly known as the Aragalaya, claiming it was orchestrated to destabilise the country. He alleged that young protesters were unknowingly “acting out a foreign script” under the guise of patriotism.

Gammanpila also alleged that Chung played a key role in elevating the National People’s Power (NPP), which he referred to as the “Malimawa” movement, into a governing force in 2024. He claimed the movement had been transformed from its earlier ideological roots into, what he described as, a pro-Western political project, asserting that President Anura Kumara Dissanayake had come to power with foreign backing. He cited a photograph shared on Chung’s social media account of her visit to the NPP headquarters as evidence of what he termed political proximity.

According to Gammanpila, Ambassador Chung’s public criticism of governance issues sharply declined following the change of government. He alleged that while she had frequently commented on incidents under previous administrations, she had remained silent on alleged corruption and governance failures over the past 14 months.

Turning to the future, Gammanpila urged caution regarding the incoming US Ambassador, Eric Meyer, stating that any engagement on religious or cultural matters should be viewed carefully. He called on President Dissanayake to pursue an independent foreign policy, free of external influence.

Gammanpila also criticised the government over, what he described as, repeated “policy blunders,” particularly in relation to issues affecting children and social values. He cited several instances, including proposals to promote Sri Lanka as a destination for same-sex couples, educational material controversies, and a recent People’s Bank advertisement that he claimed subtly promoted same-sex symbolism. While stating that he held no animosity towards the LGBTQ community, Gammanpila said he opposed, what he described as, attempts to influence children through state institutions.

In addition, the PHU leader condemned legal action taken by the Coast Conservation Department against nine individuals, including four Buddhist monks, for installing a Buddha statue within a coastal conservation zone in Trincomalee. He described the arrests as discriminatory, alleging that similar structures belonging to other religions and commercial entities had been overlooked.

Calling the current administration “anti-Buddhist,” Gammanpila urged authorities to apply the law equally and not just in words, and  “not to turn legal frameworks into instruments against Buddhism.” He also accused members of the government of ingratitude, alleging that many had once sought refuge in temples during periods of political violence.

By Anuradha Hiripitiyage

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