Foreign debts affecting country’s sovereignty - JVP | Daily News

Foreign debts affecting country’s sovereignty - JVP

JVP General Secretary Tylvin Silva yesterday said that Sri Lanka has been caught in geopolitical gymnastics of superpowers due to the policies followed by the Government.

“These superpowers are threatening the sovereignty and the independence of the country,” he said. He said these countries can influence the country due to the foreign and economic policy adopted by the Government. Silva said the country is falling into the clutches of several economic powers in the region and in the world and that it is in danger of becoming a playground for world powers.

“This situation has been created due to the foreign policy pursued by this government and the previous government.” Silva noted.

Silva furthered, “This is not to say that we should not deal with the rest of the world. Although a small country, we must deal with it as an independent, sovereign state. However, the country has been plunged into a serious debt crisis. So we have to borrow more or sell more resources. The debt-ridden economy pursued by previous governments and this government has made Sri Lanka a pawn of all these countries. In fact, creditors are coming to our country.

Of course, the debtor must bend the knee when the creditor arrives. When one creditor leaves, another creditor arrives. Our country is stuck in a debt crisis of over 13 trillion rupees. Due to this increase in debt, Sri Lanka was downgraded to a country with the lowest lending capacity. If another unit is reduced, we will not be able to borrow from any country.”

Silva also noted, “The biggest problem in our debt crisis is the increase in the share of foreign debt in total debt. It is not difficult to repay a loan taken from within the country as we pay in rupees. Printing money is not a good option at all, but printing can save money. But dollars cannot be printed. More than 48% of Sri Lanka’s total public debt is in dollar terms.Where is the dollar for Sri Lanka to repay these loans? The collapse of our export economy has increased by the COVID epidemic. In this situation there are only two ways to repay foreign loans. One is to sell the valuable resources of our country to foreign countries. This is what is happening now.”

Silva furthered, “Last month Sri Lanka paid off a 1 billion dollar maturing loan. We have to pay 1 billion dollars by July next year. In addition, the interest rate on the loan is about 400 million dollars a month. The annual loan interest is around 4.8 billion. We are stuck in a debt trap of USD 5 billion next year.”