Patali Champika Ranawaka

MP Ranawaka notes a hidden aspect of Sri Lanka’s debt


The CBSL has reported that the public sector debt is 109.7% of the GDP. This is the highest it has ever been in history. If we disregard the government’s undervaluation of sovereign bonds, this figure will exceed 113% of the GDP.

Dinamina | June 2, 2021



Fact Check

In his statement, the MP states that (1) public sector debt as a percentage of GDP was 109.7% in 2020, (2) this is the highest public debt in Sri Lanka’s history, and (3) if sovereign bonds had not been undervalued public debt would exceed 113% of GDP.

To evaluate this claim, consulted the Central Bank of Sri Lanka (CBSL) Annual Reports.

Claim 1: According to the CBSL Annual Report 2020, central government debt in 2020 amounted to 101% of GDP. In combination with SOE foreign project loans (2.1% of GDP) and government guaranteed debt (6.6% of GDP), total public sector debt amounted to 109.7% of GDP, confirming the MP’s first claim (see Exhibit 1).

Claim 2: consulted the CBSL Annual Reports for all years where Sri Lanka’s central government debt exceeded 100% of GDP. Central government debt exceeded 100% of GDP on 7 occasions (see Exhibit 2). The Annual Reports did not publish data on total public debt prior to the year 2000. As per the published data on total public debt, 109.7% of GDP in 2020 is the highest post-independence public debt reported for Sri Lanka, confirming the MP’s second claim.

Claim 3: The MP alludes to the fact that CBSL uses market value to determine the outstanding external debt liability of Sri Lanka’s International Sovereign Bonds (ISBs). As of end 2020, total ISB liability (at market value) accounted for in Sri Lanka’s public debt was USD 11,868 million. However, the actual liability that Sri Lanka had to repay creditors is based on the face value of the ISBs, which was USD 14,050 million (as at end 2020). If the face value (instead of current market value) of outstanding ISBs was considered Sri Lanka’s total debt would increase by 2.7% of GDP. In effect, increase the total debt figure to 112.4% of GDP (Exhibit 4). The figure 113% claimed by the MP is very close to the correct figure.

Therefore, we classify his statement as TRUE.

*’s verdict is based on the most recent information that is publicly accessible. As with every fact check, if new information becomes available, will revisit the assessment.


Additional Note

1) While the Central Bank uses the market value to record ISBs held by non-residents (external debt) it appears to use face value to record ISBs held by residents (domestic debt). 2) The figure for the external debt component of ISBs in table 103 of the Statistical Appendix of CB AR 2020 is LKR 1,796.6 bn (US$ 9,638 million), which should be equivalent to the external debt component of ISBs in table 5.12 of page 142 of the CB AR. However, the latter table has a figure of US$ 7,555 million – creating an error of US$ 2,083 million, which cannot be accounted for.


Central Bank of Sri Lanka, Central Bank Annual Report 2020, Table 5.12, p.142, available at

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