Friday 1st of March 2024

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The reasons behind the escalation of the countrys debt crisis..!


2021-12-20 7697

 

The Government debts have been shown fraudulently by reducing the actual figures

 

Borrowings between 2015 and 2019 have increased by 42.8%

 

Out of the borrowings, 89.8% is interest

 


A recent report by Verité Research stated that the main reason for the exacerbation of the debt crisis of the country in 2015-2019 was the requirement of paying interest on loans taken in previous years.


The report highlights that Sri Lanka's debt increased by 42.8% during 2015-2019, of which 89.8% was interest on loans taken in previous years and Verité Research has also made an estimate for calculating the cost of interest.

It has come to light in the investigations, carried out by Verité Research in calculation of these loans while studying the weak points in the accounting systems of the Government that the debt obligation of that year has been shown as a reduced amount by transferring $ 828 million obtained from the Exim Bank of China for the construction of the Puttalam Coal Power Plant in 2014 from the Government’s Accounts Book to the Ceylon Electricity Board.

The Government’s debt obligation has been shown as a reduced amount by transferring the US $ 951 million, obtained from the Exim Bank of China for the Hambantota Port Development Project from the Central Government Accounts Books to the Sri Lanka Ports Authority Accounts Books and this too had been done in 2014.

Verité Research pointed out that the steps, taken by the Government to show less figures of loan obligations against the actual figures in these informal accounting methods has left the whole country in a debt trap while making people extremely helpless.

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