Sri Lanka’s public debt has increased dramatically under the ruling Rajapaksa regime and every citizen is now in debt to the tune of Rs. 360,000 (USD 2769), says United National Party MP Eran Wickremaratne.
Eran Wickramaratne MP
The figure was confirmed by Deputy Minister of Finance Sarath Amunugama who said that the debt of every citizen had crossed the Rs. 300,000 mark.
Joining the debate on the Government’s Budget for 2014 Wickremaratne said that Sri Lanka was in debt to the tune of Rs. 6.63 Trillion (USD 51 Billion). “During the UNP regime the national debt stood at Rs. 1.86 Trillion,” Wickremaratne said.
All this while 2 percent of Sri Lankans are living on less than USD 2 a day, he said.
Wickremaratne said that the Government was imposing 80 percent of its taxes as indirect taxation on the citizens, while only 20 percent of taxes were being extracted directly, meaning the citizen had no idea how much of a percentage of the price of goods and services were being taken from them as taxes.
PalmSquirrell / November 26, 2013
“All this while 2 percent of Sri Lankans are living on less than USD 2 a day, he said.”
There must be some mistake with that “2 percent” figure because from what I saw/heard first hand in Colombo and up North, the % of people not making even 2500 rs a day is far higher.
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Leonard / November 27, 2013
US$ 2 a day is approximately equivalent to Rs. 260 (give or take a couple of bucks) so he is right , you are talking about US$ 20/day, many people in Colombo and the suburbs do not make this type of money
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PalmSquirrell / November 28, 2013
My mistake. I know $1 is about 130ish rupees but kept thinking 1300 rs.
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shankar / November 29, 2013
that is because you are hoping in your heart that it will be rs1300 when you go on your next holiday.Sweet dreams are made in heaven they say.
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PalmSquirrell / November 29, 2013
You are a mind reader? Why are you wasting your time on CT; every minute spent here could be utilized to fleece the stock market.
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shankar / November 29, 2013
You seem to be a mind reader too,though i won’t call it fleecing,it is a skill of sorts to read the mind of the hedge funds.
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Coockoo Bird / December 4, 2013
Let the debt soar to 01 million rupees per person.
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Lenny / November 27, 2013
Palm Squirrell, get your calculations right, US$ 2 is approximately equivalent to Rs. 260 (give or take a couple of Rupees) Rs. 2500 is approx US$ 192,
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Amarasiri / November 28, 2013
Palm Squirrel,
http://www.echelon.lk/home/coming-down-to-earth-after-living-beyond-our-means/
More bad news. In 2012 the debt servicing costs were 3% more than the government revenue. In simple terms the government does nothing but pay interest on previous loans with its income. This forces it to take more loans to cover government expenditure. More loans lead to more interest and more debt servicing. This vicious cycle, unless broken fast, can push us into conditions Greece, Portugal and Ireland face right now – See more at: http://www.echelon.lk/home/coming-down-to-earth-after-living-beyond-our-means/#sthash.jXzgJdoL.dpuf
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tuan / November 26, 2013
This is what happens when a Bunch of stupid idiots leads a Country with wide corruption and mismanagement.Also all those people who voted this idiot for a Packet of Rice and Rs 100 also equally deserves same.If this trend continues for awhile Sri Lanka people will suffer Starvation.
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Native Vedda / November 27, 2013
tuan
“If this trend continues for awhile Sri Lanka people will suffer Starvation.”
No need to worry too much, MR clan has the ability to “mine” digital gold, peer to peer cryptocurrency, the new Bitcoin.
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The Penetrator / November 27, 2013
Is it the thieves that actually published these numbers about how much we owe?? I think the debt in this country is going to hit our great great great grandchildren. the figures are like santaclaus, I wont believe it until I see it with my own eyes..
Don’t be fooled by what these cocksuckers are doing, if this country was a business, who the hell would want to take this on and make it profitable?? With the amount of debt, it an impossible task for the opposition party cockroaches to fix and carry on. The parties are all the same!! All thiefs but I must admit there might be one or two genuine ones, they are too small to consider though because of the budhist/sinhala modayas, Christians, Muslims, Hindus and the money hungry rednecks. And also the Veddas..
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Native Vedda / November 27, 2013
The Penetrator
“And also the Veddas..”
What is your problem with Veddahs?
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The Penetrator / November 27, 2013
Native Vedda
“What is your problem with Veddahs?”
Nothing, just want to make sure they are included in the classification of Sri Lankan people. Especially the Veddahs that are intellectuals and no longer living the simple life in the jungle.
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Native Vedda / November 27, 2013
The Penetrator
” Especially the Veddahs that are intellectuals and no longer living the simple life in the jungle.”
There are no intellectual Veddhas however I can assure you Veddah elders are only wise.
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K.A Sumanasekera / November 27, 2013
Every American owes USD 50,000
That is 7 Million LKR per person, including even new born infants.
Equivalent to 300 Million two bedroom pads in Colombo 6.
36 % of Indian population live under One Dollar a day. That is close 500 Million poor people.
And this Eran is whinging about our citizens owing USD 2700 .
And his take is that our citizens owed only a third of that under their watch.
But he doesn’t mention what we had then besides Prabakaran’.
Did we have one hour Express to Galle in Luxury in Air conditioned comfort even for the proletariat?.
Did we have Super Luxury Vellala Coach Line all the way to Praba’s former heartland?.
Did the Colombo elite and their ex CJ mates live in super Luxury at Trillium pads?
Not to mention new harbours, new airports,new conference centres,and the list goes on and on.
That is even not touching on the 8 % growth,for 4 consecutive years and 22 % in the new TNA territory.
However it is worth mentioning that marvellous shot of our Vellala CM standing shoulder to shoulder with Blue Eyed boy from Bullington on the second floor balcony of the former LTTE nursery.
How much value can you put on that?
The sad part is that photo shoot didn’t have Eran’s Boss, standing next to the Vellala CM.
Wonder whether he didn’t get an invite?
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PalmSquirrell / November 27, 2013
FFS , what does it matter to SL what America or India owes, it doesn’t make SL’s debt go away.
America is a special case, because despite their debt burden they are the world’s largest economy and have the capacity to continue creating wealth like no other nation. What the hell does SL have besides agriculture and tourism.
India is far larger than SL and an emerging glocal economic power.
You are really cluctching at straws trying to deflect criticism of GOSL’s mismanagement and corrution.
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Dr.Rajasingham Narendran / November 27, 2013
India has approximately US $ 300 billion in reserves. These reserves are more than its national debt. She can pay back all her debts in one day and yet have some reserves left over.
Potatoes and onions cannot be compared!
Dr.RN
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Native Vedda / November 27, 2013
K.A Sumanasekera
“Every American owes USD 50,000”
You are rest assured we can reach $50,000 target from $2,769 in no time if focused our effort towards achieving parity with USA.
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K.A Sumanasekera / November 27, 2013
Dear Native,
Poor Americans don’t have even free Medical cover,with 50 grand debt, let alone re building their ageing Infrastructure or even replacing the likes of 100 year old Bridges,
They used all that going after terrorists,in Iraq, Libya, Afganistan, Syria, now even in Lebanon.
With just under 3 grand,see how much we have already built not counting the Mega Casinos, and Mega Luxury pads like the Alliance Capital Towers from your neck of the woods.?.
And all that on top of rehabilitating 11,000 of them,Terrorists and providing the basics for 300,000 of their relatives who were forced to serve their leader.
Just imagine what Srilanka will be if we borrow 50 G per capita.
Your Diaspora mates, who are vying for duals now might ask for permanent residence permits.
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PalmSquirrell / November 28, 2013
” Dear Native, Poor Americans don’t have even free Medical cover “
This is not really true.
Poor Americans qualify for Medicaid, which is for low income persons. In addition to that many States and Counties have their own free healthcare programs independent of the Federal Government’s Medicaid program.
Americans or non Americans can also walk into any Emergency room and receive medical help, and by law can not be turned away even if they show no proof of insurance or ability to pay.
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Native Vedda / November 28, 2013
K.A Sumanasekera : – :
“Poor Americans don’t have even free Medical cover,with 50 grand debt” : – :
Would you be kind enough to organise and run free medical camps for the poor American through out their vast country funded by middle income citizen of this country and their diaspora headed by Dr Nonis?
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jayakarthik / November 27, 2013
dear sumanasekara,
i would like to produce a sane reply to your comment.every american owes $50000 and india also has a huge debt.it is not a crime to have a debt or to borrow as long as you have the capacity to repay.in individuals case if he or she borrows he needs to have sufficient income to borrow or else he will go bankrupt.in case of a country going on a borrowing binge if the borrowing is done sensibly at a lower rate of interest and invested constructively country can prosper or else it can go either bankrupt or its rating will go down where a situation will develop that no lender will lend or he will ask higher return for his investment.as far as america is concerned it does not suffer from borrowings like other countries because its currency is the reserve currency it can keep on printing money that is what it is doing now with a nomenclature quantitative easing.another advantage america has is its companies are sitting on two to three trillion dollars cash pile hence practically america is not borrowing rather americans are being offerred cheap money by other countries.as far as india is concerned it has got a robust corporate companies which borrow and service the debts.indian government does not borrow because it has sufficient foreign reserves if need be since it enjoys moderate ratings it can borrow at a reasonable rate of interest.when it pertains to srilanka though government has built airports,ports,highways which are classified as infrastructure projects ideally is a positive accretion to the economy moot question is whether all these utilities are being utilised to an optimum level so that debt can be serviced and it can be repayed.that is a $51 billion question.
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Lenny / November 27, 2013
@ K. A. Sumanasekera The achievements you are trumpeting about is only what the rich and powerful can afford, the majority of the people are just trying to live, no exist ! It is true we have New Highways, New Ports and even a New Airport, but let me tell you this: We have highways, but no cars on it, we have Harbours, but no ships anchored in it, and Airports with no planes landing at it, so bottom line is that this country is hocked to the hilt just because a chosen few can enjoy luxuries
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Senguttuvan / November 28, 2013
Sumane,
I recently did a Galle run from near Royal College, Colombo on the so-called Super Highway – by the way, together with two Vellalar friends
and a Kandyan Govigama (KGB) I mention this because you are obsessed with the stuff.
It is a lovely, picturesque drive. But it takes over an hour to get from Colombo to Padukka – in the maddening traffic. The drive itself was about an hour. But I was scared of the dogs in the highway. So the net gain is not much to write home about. I am aware there are steps to
link the highway from Colombo proper itself – but that will take a few years. I am not complaining – but merely stating facts.
But if it gives any satisfaction to your anti-Indian persona, this is
leagues better than most so called highways in S. India or Bombay.
Senguttuvan
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kattakarawala / November 29, 2013
K.A Sumanasekera,
How much do we tax payers have to pay towards your upkeep as a Rajapaksa apologist?
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HLANGL / March 25, 2014
I’m afraid, if you consider the complete statistics, the numbers are not that great for Sri Lanka. In fact, the countries like USA, Canada, Australia, UK, etc. are all still doing much much better than the countries like us. Consider the following carefully.
External debt of a country, or its percentage to GDP for that matter, is only a portion of the more complete NIIP (Net International Investment Position) which reflects much more completely regarding how a country stands in the international economy. Definition of NIIP: “A nation’s stock of foreign assets minus its foreign liabilities. The Net International Investment Position (NIIP) can also be defined as the value of overseas assets owned by a nation minus the value of domestic assets owned by foreigners. The NIIP can therefore be regarded as a nation’s balance sheet with the rest of the world at a specific point in time….(“http://www.investopedia.com/terms/n/net-international-investment-position-niip.asp”). So taking loans is fine as long as if some of these large debts can be covered at least by your foreign assets, outside GDP (GDP by its very definition “domestic”, within your borders) but still belong to you. This is the case with multi trillion USD economies like USA, etc., you still can survive without becoming bankrupt if the net deficit is maintained in a manageable range. Just look at the NIIP figures for USA, or Canada, or Australia, or UK for that matter, that’s why they could tolerate and survive even through the so-called economic crisis, because as a whole, they were still far away from becoming bankrupt as they had these other cover-ups.
“http://elibrary-data.imf.org/public/FrameReport.aspx?v=3&c=20840396”
“http://en.wikipedia.org/wiki/Net_international_investment_position”
Now consider the percentage of NIIP compared to GDP. All these mega economies which are with large external debts are highly compensated by their huge pools of foreign assets so that their net deficits still make them either an international creditor or a debtor in a very manageable range compared to their very high GDPs.
But what’s the case with most smaller GDPs ?. Consider Sri Lanka. Do we have any considerable foreign assets (the assets owned by Sri Lankan entities in foreign countries, outside Sri Lankan borders.) to negate our external debts ?. What else do we have to negate this huge (compared to our GDP, it’s approximately 60 billion USD only. To put that into perspective, the GDP of USA is 15 trillions USD (15000 billions USD). ) ?. This is the outcome, the net IIP for SL is more or less equivalent to its external debt with practically no or very minimal means/cover-ups (i.e. foreign assets/investments, the things you own outside your own country.) to recover it. So currently the net gap is nearly 30 billion USD with our 60 billion USD economy, which is almost a 50% gap. For USA, Canada, Australia, UK, etc., this net gap had been positive in the past making them international creditors. Even with their economic crisis, it’s only marginally negative these days, certainly not a huge percentage like ours compared to their high GDPs. So whose situation is at more risk, aren’t we more vulnerable ???.
You have to consider all these economic parameters. The thing is the Central Bank of Sri Lanka doesn’t even publish these more complete figures including NIIP which is clearly disadvantageous to Sri Lanka taking loans from IMF, etc.
No data for Sri Lanka is available,
“http://elibrary-data.imf.org/public/FrameReport.aspx?v=3&c=20840396”
“http://dsbb.imf.org/pages/gdds/DQAFViewCollapsedPage.aspx?ctycode=LKA&catcode=BIIP0&Type=CF”
But I think everyone may know our numbers here. As a country, do we own any considerable foreign assets (the things we own outside of Sri Lankan boundaries…) to compensate for our external debt which is almost 50% of our GDP, just like USA owns multi trillion USD investments outside USA ?. So what options we’re left with to cover up this gap which is only expanding day by day.
Just be honest to us, we are still not in a position to boast about, we should re-assess our capacity and strength so that we won’t make our situation even worse. There has to be a balance when it comes to external debts for smaller economies like us, also we should make sure that the debts are utilized for profitable investments, otherwise we don’t have the capacity to pay at least the interest of these loans. You and me driving in expressways here in Sri Lanka won’t bring anything to the country unless we are somehow able to attract foreign money through these projects driven by foreign debt, at least to pay their interest. See what happened to Greece, mind you it’s a country with 250+ billion GDP, with 20000+ USD per capita, …. We need to consider all these parameters and re-assess our situations and the direction we’re heading to. True, the 30-year old war ended, but we don’t have anything to boast about yet on the international stage. A person who accepts that a particular specific issue exists would at least thrive to make the situation better, but the agony here is most Sri Lankans here have at least no clue whatsoever regarding the actual picture. The government here has carried out all these projects they boast about by taking loans from external parties, or as BOT (Build, Operate and Transfer) ventures. So effectively, these are not yet “owned” by “us” “fully”, nor are they making any “net” profit. So how to settle at least the interest of these loans, especially the commercial loans taken more recent ?. Will take 100s of years given the current rates. By taxes, or by another smaller scale loans. This is a vicious cycle which, unless addressed soon, has the potential to bankrupt the entire economy.
China is the only winner here in Sri Lanka. They are investing their money in our coutry, they provide loans to us at higher interest rates, take back the mony they lend eventually through their terms & conidtions as well, because Sri Lanka is supposed to have a Chinese construction campany (i.e. China Merchants Group) if they are to get loans from Sri Lanka. If it’s a BOT (Build, Operate and Transfer) venture, China is the “actual” owner till they recover their investment, may take years then given the current profits of these projects.
I had to go lengthy, but some are meant to be lengthy to convey the full picture… Hope this clarifies.
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Sengodan. M / November 27, 2013
It will not take long for the MaRa regime to make the country sink in its own debts!
Sengodan. M
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Banda / November 27, 2013
is in debt to the tune of $50,000. And we know that is way above their GDP per capita. What each of us owe (Rs360,000/- as you say) is 75% of our GDP per capita. So, in comparison, I thought Sri Lanka debt is in a better position than the US. And we’re growing much faster than the US and thereby can lay hope to reduce the debt/GDP ratio further to 65%. But I do not know what the acceptable ratio is for you experts.
Anyway, common sense tells me that no country can develop without borrowings. I understand that over borrowing is bad and borrowed money must not be used for partying but to invest wisely. Tell us, how could investing in agro projects like Moragahakanda, and infrastructure projects like harbours, airports, power stations, new roads, highways etc, and above all to fight and eradicate terrorism and thereafter investing to maintain peace and stability a waste? I think people take all that as good investment.
That doesn’t mean to say this government do not waste and control everything perfectly. What I say is we have peace, stability and growth after 30 years of terrorism. Sri Lanka is far far better than most countries.
The separatists hasn’t given up their Eelam project. It is clear that neocons back them indirectly. Sridharan the TNA, MP has spelled it in no uncertain terms. Could a Muslim MP in the British parliament praise Bin Laden as a hero. They’ll put him behind bars. We can only imagine what the rest of the TNA pack including Wigge have in their tummies, hearts or heads. Most commentators here would no doubt back Sridharan to the hilt. They await for pre-election upheavals like in Bangladesh. Thanks for Rajapakse, nothing of the sort can take place expected here. And that’s what majority voters want.
Majority voter sentiments is the key to the stability of any country. Best example is Malaysia. The UNP leader and his cohorts like this evangelist writer do not care two hoots about the aspirations of the majority. Their priority is to satisfy the neocon roadmaps. And neocon game has been to divide this country. Fortunately, majority voters know this. So, the UNP has no chance in hell to win even a PC let alone the country for a foreseeable future.
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Dr.Rajasingham Narendran / November 27, 2013
if the following information that is being circulated is correct, how can this country make ‘Real and sustainable’ progress?
” BUSINESS TIMES
* Top Sri Lankan Official in the dock over Mega Colombo Deal
* Woodpecker pecks on many a tree, but gets entangled on a banana tree.
* It is easy to guess the Top Sri Lankan Official in the BT lead story as Nalaka Godahewa.
* He was planted by mafia as SEC Chairman, with a powerpoint by Dilith Jayaweera.
* SEC investigations of mafia went cold, though COPE Chairman DEW blew very hot.
* Godahewa was Jayaweera’s Chairman on Divasa Finance and Colombo Land.
* BT lead story refers to extraction of payments from foreign investor, Krish – loved by Harsha.
* Accountant, Gamini Fernando refused to go along with this extraction process of bribery.
* Fernando with payment vouchers spilled beans to powerful Secretary, UDA, who had got livid.
* Vouchers had been in the name of Namal, with no knowledge by him of same.
* Payments extracted had been deposited to various bank accounts of other persons.
* Jayaweera has been taking this young politician about as a marketing strategy.
* A deposit of monies extracted had been to Nimal’s account, who had not known of this bribery.
* Jayaweera had owed monies to Nimal on purchase of George Steuart’s.
* Dated cheque to Nimal had bounced at the PABC Bank.
* As per BT lead story all transactions of this Official are to be investigated.
* Godahewa was severely found fault with by PBJ, as Tourism Boss.
* Sometime ago, there was the sale of 26% Shares of Lanka Hospitals to Fortis.
* Local agent of Fortis had been short-circuited by Godahewa, same as Krish
* Godahewa pushed the deal with Jayaweera’s help, clearing Fortis Chairman through VIP lounge.
* Harry J’s company sold the Shares to Fortis and paid Rs.125 million commission to unnamed.
* Directors of Lanka Hospitals were ousted by Godahewa to make room for Fortis.
* Jayaweera misled the President to fault the Fortis local agent for this story in Sunday Leader.
* To become Chairman of Divasa Finance, how much deposits did Godahewa make ?
* UDA is a shareholder in Colombo Land and UDA Director, Godahewa, its Chairman.
* Godahewa and Jayaweera bought Colombo Land Shares frightening Singaporean Investor.
* Jayaweera is known to peddle the powerful Secretary’s name to get things done.”
Dr.rajasingham Narendran
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Stewart Sloan / November 27, 2013
Eran Wickramaratne MP is a rarity in many countries of the world, Eastern or Western. He’s an honest man in Parliament.
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shankar / November 27, 2013
“in debt to the tune of Rs. 360,000 (USD 2769),”
Wonder how much hambantota is worth for the chinese?If our future generations hand it over to them to have as an chinese overseas territory,then maybe the chinese might agree to waive the debt.
Two birds with one stone get rid of the debt and the hambantotuans too.
No,come to think of it, might be even three birds, screw india too.
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KLM / November 27, 2013
What if a individual wants to pay his due 360,000/= to Govt and clear his debt.I will ,if Govt in return exempt me from Taxes?
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J.Muthu / November 27, 2013
As long as Sinhala Buddhist fools in sleepy mode, Rajapakse thugs loot left righr centre….enjoy u monkeys.
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K.A Sumanasekera / November 28, 2013
At east this uncle Wicks has written something on our bread and butter issues.
What has the shadow treasurer and monk lover Harsha been doing?.
This is the first time a UNP Opposition spokesperson has said something relevant to the real issues facing the Nation.
And hats off to him for that simple reason.
UNP has to come up with issues like these to convince the non believers.
No point in pleasing the converted, the Diaspora and their Western backers.
Prez election is only months away.
Has the leader of the Cinnamon Faction articulated any policies which will reduce National debt and give extra few notches of development on top of the current 8 percent?.
Has he offered better and more infrastructure to facilitate more investment, more growth,more jobs, more hospitals, more Universities,more schools and more money in the pocket?.
Has he put a target on the Per Capita Income?
Has he apologized to the Tri Forces for ridculing them, when thousands of brave soldiers were making the supreme sacrifice to save the Nation?.
Has he promised the Armed Forces that he will not give into his Western Mates and compromise the security and the Territorial integrity of the Nation?.
Is he going to back Keselwatta Kid as the common candidate to roll the President?.
Is he capable ?. Is he up to it?
These are the issues that the inhabitants are concerned and want to know what the UNP offer.
The days when Eran’s Leader waved Bracelets, and Mobile phones at the inhabitants are well and truly over.
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Ahamed / November 28, 2013
All this nonsense of heavily borrowing was started by the UNP from 1977. Before that Srimavo bravely tried for sustainable development. She lost the regime because of that and thereafter the UNP had brought us to a point where there was no return back to 1977. All the subsequent governments have to continue the UNP’s open economy policy and to compete with other nations, compelled to borrow from outside.
Nevertheless, I am also against heavy taxing. The government should find a way to make its ventures profit making, it doesn’t mean you have to sell the institutions to private parties. Government should employ competent people to operate government institutions in a transparent manner. They can begin with SriLankan Airlines!
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paul / November 28, 2013
This is stupid scare mongering. According to GDP league tables on the net, Sri Lanka is performing much better than the he rest of the world..In fact it in the 65th position among 180+ countries..
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)
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Truth / December 1, 2013
Eran, your foolish party leader cancelled the Japanese funded partly built Colombo – Katunayake Expressway and paid compensation to the contractor for the breach of contract. Rebuilding it later cost much more. The per capita debt would have been less if did not make this blunder. He should be asked to pay the cost of the loss suffered by the country by this decision, to reduce the National debt.
The accepted measurement of National Debt is the ratio of debt to GDP, which appears to be moving in the correct direction,
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