Reservations on President Dissanayake’s Reserve Figures

Fact Check

During an election rally ahead of the local government elections, the president claimed that Sri Lanka currently holds the largest dollar reserve in the past five to six years.  

To check this claim, FactCheck.lk analysed foreign reserve data from the Central Bank of Sri Lanka (CBSL) and the IMF Staff Reports. It was assessed using two indicators: (i) the USD value of reserves, and (ii) the number of months of import cover in reserves. This evaluation compared the reserve figure as of March 2025—the time the president made the claim—to the past, based on these two indicators. 

1. USD value of reserves 

CBSL data show that Sri Lanka’s foreign reserves exceeded USD 6.5 billion—reported in March 2025—on five occasions in the past five years (since April 2020) and 17 occasions in the past six years (since April 2019). The most recent instance was in September 2020, when reserves reached USD 6.7 billion (4.5 years ago). 

However, since December 2021, reserves include an approximately USD 1.4 billion currency swap with the People’s Bank of China. This swap, which is subject to significant restrictions on usability, does not qualify as a reserve asset and should not be counted as part of Sri Lanka’s foreign reserves (see FactCheck.lk’s explainer). 

Excluding the swap, the foreign reserves properly defined are USD 5.1 billion, as of March 2025. Past reserves exceeded this USD 5.1 billion figure on 9 occasions in the past five years, and 21 occasions in the past six years. The most recent instance was in December 2020, when reserves were USD 5.7 billion (4.25 years ago). See data in Exhibit 1. 

Thus, Sri Lanka’s reserves in March 2025, whether using the CBSL’s reported figure or the properly defined reserves figure, fall significantly short of being the highest over the past five to six years, as claimed by the president. Reserves in March 2025 were the highest in the last four years (after Sri Lanka lost access to international financial markets), and not the last five to six years.  

2. Months of import cover in reserves 

This indicator measures the number of months of reported imports that can be financed by the foreign reserves. It is calculated based on the average monthly import of goods over the 12 months leading up to and including the reference month. For March 2025, the import cover based on CBSL’s reported reserves is 4.05 months. This drops to 3.20 months when based on the properly defined figure for foreign reserves. 

The import cover based on the reserves reported by CBSL exceeded the 4.05 months calculated for March 2025 on 11 times in the past five years, and 22 times in the past six years, The most recent instance was in November 2024, when it reached 4.21 months. Similarly, the import cover based on the properly defined reserves surpassed the 3.20 months figure for March 2025 13 times in the past five years and 25 times in the past six years. The most recent instance was in November 2024, when it stood at 3.30 months. These figures show that, even by this indicator, reserve strength has been higher than the March 2025 figure in a number of months in the past five to six years. 

In sum, the president’s claim that Sri Lanka’s reserves are the largest in the past five to six years is incorrect, both on the figures reported by CBSL, and on the properly defined reserves. But reserves in March 2025 were the highest in the last four years—as reserves had declined dramatically from around the second half of 2020. The claim remains flawed in the same way even when months of import cover, instead of the USD value, is used to measure the strength of the reserves. 

Therefore, we classify the president’s statement as FALSE. 

*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. 

Exhibit 1: Sri Lanka’s Foreign Reserve Assets and Import Cover: April 2020 to March 2025