JVP asks why govt. so secretive about ‘domestic debt optimisation’

By Rathindra Kuruwita

The JVP yesterday asked the government why it had closed the banks for five days and summoned Parliament without an Order Paper if it was confident that the domestic debt restructuring would have no detrimental impact on the people.

JVP’s Dr. Nalinda Jayatissa told journalists in Colombo that the government had a responsibility to tell the people what it was planning to do.

“The JVP has not tried to cause panic contrary to claims made by some government ministers, and the problem was that the government had always been very vague about domestic debt restructuring,” he said.

“In April 2022, Sri Lanka defaulted on external debt servicing. At this point, there was no discussion on domestic debt restructuring. Then the government sought assistance of the IMF and reached an agreement with the latter. Even then, the government didn’t talk about domestic debt restructuring. Actually, some ministers said there would not be domestic debt restructuring, he said.

Dr. Jayatissa said that following the IMF agreement, Sri Lankans learned that the total debt of Sri Lanka amounted to 85.5 billion U.S dollars by the end of 2022.

“41.4 is external debt, and the rest is domestic debt. Out of the domestic debt, 25 billion dollars are in Treasury Bonds, 11 billion in Treasury Bills, 5.6 billion in development bonds, and the rest has been taken from various institutions. Who has invested in bills and bonds? Either state or private banks, insurance companies, or EPF/ETF. Apart from the deposits of customers, do these institutions have other substantial assets to buy these bonds?” he asked.

The JVP stalwart also asked the government to explain the difference between domestic debt restructuring and domestic debt optimization.

“Parliament is apparently meeting over the weekend. There isn’t even an order paper or a party leader’s meeting. If there is no problem for people, why is Parliament being summoned on a weekend without even an order paper? If nothing happens, why have they given banks a five-day holiday? The President also insists he will close down the stock market. Why are they asking people to stay at home?” he asked.