In a bid to address the pressing issue of local debt restructuring, the Parliament has been scheduled to convene on Saturday (01), emphasizing the urgency of the matter. The government’s efforts to adopt these proposals come in the wake of a recently announced bank holiday, set to span five days, which has garnered significant attention within the banking industry.
President Ranil Wickremesinghe, currently on an official visit to London, is expected to return to the country tomorrow. Upon his arrival, a special meeting of the ruling party will be held on the 28th, during which the critical need to restructure domestic debt will be specifically discussed.
Ahead of these developments, the chief organizer’s office of the ruling party has communicated via WhatsApp, instructing all government ministers to remain in Colombo starting from tomorrow, without providing a reason for this directive. Furthermore, the President has cancelled the foreign visits of ministers who were scheduled to travel abroad during this period.
Nevertheless, economic experts express concerns that if a portion of the government’s loan from the Employees’ Provident Fund is reduced or the interest rate is lowered as part of the local debt restructuring, it could have severe implications for the fund. They argue that a more appropriate approach would be to allow the government sufficient time to repay the loans from the Employees’ Provident Fund, without outright write-offs.
Addressing these concerns, Minister of State for Finance, Shehan Semasinghe, made a pledge in Parliament last week, assuring that the government will take measures to prevent any harm to the funds of the Service Provident Fund or the Employees’ Trust Fund through the proposed restructuring.
Amidst these developments, there is speculation regarding potential strong public opposition to the debt restructuring plans. As the government moves forward with its proposals, navigating these challenges will be crucial to ensure a balanced and sustainable solution.