COLOMBO (Reuters) -Sri Lanka has nearly completed its debt restructuring process and is set to regain the economic output it lost to the 2022 financial crisis, President Anura Kumara Dissanayake said on Friday as he presented the budget for 2026.
Dissanayake, who is also the finance minister of the Indian Ocean island nation, told lawmakers that Sri Lanka’s economy was now stable and it had regained the confidence of investors.
“For a long time, Sri Lanka was under severe debt,” Dissanayake said. “But debt to GDP, which was earlier at around 104%, will reduce to 96% of GDP this year and our target is to reduce it further to 87% by 2030.”
“By the end of this year, Sri Lanka will regain the economic output lost from the crisis,” he said, adding that the country would aim for 7% growth in the medium term.
The debt of national carrier SriLankan Airlines, that includes a $175 million bond that is currently being restructured, will be completed by December, he added.
Dissanayake swept to power late last year on a pledge to end corruption and stabilise the economy after a record dollar shortage triggered a financial meltdown in 2022.
The South Asian country has been working to meet IMF conditions, including achieving a 2.3% primary surplus target and boosting public revenue to 15% of GDP for 2025.
(Reporting by Uditha Jayasinghe; Editing by YP Rajesh)
