Prez should have invited party leaders to consultation with IMF MD before finalization of agreement

By Rathindra Kuruwita

President Ranil Wickremesinghe should have invited political party leaders in Parliament to discuss the implementation of the IMF agreement with the fund’s Managing Director before signing the agreement, Chairman of the Communist Party of Sri Lanka (CPSL), D. E.W. Gunasekara said in a recent televised interview.

Recently, Wickremesinghe invited the leaders of the political parties represented in Parliament to discuss the implementation of the IMF agreement and come up with a collaborative approach.

“Now, the agreement has been signed. The purported objective of the agreement is to help the country restructure its debt. IMF staff and the Sri Lankan authorities have reached a staff-level agreement to support Sri Lanka’s economic policies in September 2022. So, almost 18 months have passed. We have only restructured domestic debt so far. That too was done by misusing the EPF and ETF,” he said.

Gunasekara said that by the time the 2015 bond scam happened, 16 companies had bought Treasury bonds and bills issued by the government. Four of them were owned by the state, i.e., the EPF, the Bank of Ceylon, the People’s Bank, and the National Savings Bank.

“So, 12 private companies also own a significant amount of debt. These were not subject to restructuring. If we look at the external debt, we have borrowed about 40 percent from the international capital markets. China, Japan and India are our main bilateral lenders,” he said.

After assuming duties, Wickremesinghe had been to Japan, France, England and India, Gunasekara said. In each of these visits, he has tried to persuade the leaders of those nations to persuade the Paris Club to give concessions to Sri Lanka, he said.

“This has not worked out at all. We are still trying to negotiate an agreement, and the government keeps postponing the expected date of finalising external debt restructuring,” he said.