Sri Lanka tells ISB investors: Govt. locks in IMF targets, reforms

Treasury Secretary Dr. Harshana Suriyapperuma addresses ISB holders via investor call

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TREASURY Secretary Dr. Harshana Suriyapperuma yesterday told International Sovereign Bond (ISB) holders that the Government would adhere strictly to the 17th International Monetary Fund (IMF) program targets and structural reform commitments, during a scheduled investor call focused on macro-linked and governance-linked Bonds issued under the restructuring.

He said fiscal consolidation remains anchored to agreed primary surplus targets, with medium-term debt sustainability parameters unchanged.

The Government remains committed to meeting the IMF's debt-to-GDP target of 95% by 2032 and maintaining average gross financing needs within program limits.

On State enterprise reform, Dr. Suriyapperuma described the unbundling of the Ceylon Electricity Board (CEB) into separate entities as a core reform that would proceed. Cost-reflective electricity pricing will continue as part of eliminating quasi-fiscal losses.

He noted that more than 92% of Sri Lanka's external debt has been restructured, with agreements reached with nearly all external creditors.

Remaining processes are procedural.

For ISB holders, attention turns to the performance-linked features embedded in the new instruments. The Treasury Secretary said baseline projections already assume activation of Macro-Linked Bond (MLB) thresholds, while governance-linked Bond coupons are tied to revenue performance beginning in 2028.

The text of the presentation in full: Today, I will talk to you and walk you through the key highlights of the mid-2025 Public Debt Report, recent macroeconomic developments, and the status of all public sector reforms and debt restructuring progress. I will also address the economic implications of Cyclone Ditwah and the policy response that is now fully under way.