Sri Lanka must remain cautious to avoid a potential second debt default by 2028, economist Rohan Masakorala has warned. Highlighting that current economic growth forecasts by the Asian Development Bank and other agencies are not promising, Masakorala said the country remains vulnerable due to unfavorable external factors.
He stressed that the government will need to take tough fiscal measures to meet critical IMF targets, warning that delaying reforms would only hasten a fresh crisis. “We spend 60% of government revenue on interest payments alone. Imagine the situation by 2028 when capital repayments are added,” he noted.
Masakorala urged policymakers to focus on raising the country’s credit rating to at least B+ to access market-based credit and attract large-scale investments. He cautioned that a second default and another IMF bailout would have devastating long-term impacts on the nation’s stability and future development. (Newswire)
