Sri Lanka Faces Steep Post-2028 Debt Payments despite Restructuring Progress

Sri Lanka’s external debt stock rose to USD 37.24 billion by end-September 2025, according to the Public Debt Management Office. Although the country remains unable to access global capital markets, it continues to rely on multilateral lenders, who now represent 37% of the portfolio. Sri Lanka serviced USD 1.36 billion in external debt during the first half of 2025, covering more than half of the USD 2.45 billion due this year.

Central Bank Governor Dr. Nandalal Weerasinghe warned that while annual obligations will average USD 2.75 billion until 2027, they will rise sharply thereafter reaching USD 3.2–3.5 billion annually from 2028, and nearly USD 4 billion in some years.

Recent restructuring with China, Paris Club members, and ISB holders has achieved 94% completion, but analysts caution that the looming repayment surge could strain Sri Lanka’s fragile recovery unless revenue and export growth accelerate.

 

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