Fact Check
Senior Consultant on Economic Affairs and Finance to the President, Professor Anil Jayantha, addressed concerns about alleged excessive borrowing by the NPP government in a statement reported by the Daily Mirror. He claims that the majority of the debt borrowed (86%) between 27 September and 15 October was used to service existing debt obligations.
To verify the claim, FactCheck.lk reviewed debt statistics published by the Central Bank of Sri Lanka.
Between 27 September and 15 October (excluding an auction on 25 September), the government raised LKR 357 billion through three treasury bill auctions, and an additional LKR 104.5 billion through treasury bond auctions, which is a total of LKR 461.5 billion. This aligns closely with the 465.1 figure cited by Prof. Jayantha. The difference could be a transcribing error that resulted in the switch of the last two digits of five and one. Prof. Jayantha is cited as stating it as treasury bills, but FactCheck.lk interprets it as referring to all treasuries: bills and bonds, given the context of the statement.
The debt that was serviced is in two forms. Repaying maturities of past issued debt, and paying interest on non-matured debt. LKR 390.9 billion was repaid in maturing treasury bills, and LKR 22 billion was the coupon payments on existing treasury bonds. These total to LKR 412.9 billion for debt servicing within the period cited. That means, approximately 89% of the new debt issued was used for debt servicing.
In sum, there are slight differences in the precise number from those cited, but the professor’s overall claim, effectively, that over 85% of the debt issued was for debt servicing, is correct.
Therefore, we classify the statement as TRUE.
*FactCheck.lk’s verdict is based on the most recent information that is publicly accessible. As with every fact check, if new information becomes available, FactCheck.lk will revisit the assessment.