Sri Lanka plans 16% in­crease in bor­row­ing in 2018

Daily Mirror (Sri Lanka) - - LATE CITY -

Sri Lanka plans to in­crease its over­all gov­ern­ment bor­row­ing by 16 per­cent in 2018 to Rs.1.8 tril­lion (US $12 bil­lion), a doc­u­ment showed this week.

Fi­nance Min­is­ter Man­gala Sa­ma­raweera has also sought Cab­i­net ap­proval for spend­ing of Rs.3.98 tril­lion next year, up 10.5 per­cent from its es­ti­mate for this year, gov­ern­ment data showed.

Fi­nance Min­istry of­fi­cials, how­ever, said the gov­ern­ment would stick to its medium-term bud­get deficit tar­get of 3.5 per­cent of GDP by 2020.

The gov­ern­ment last month said it would cut spend­ing to stick to its 2017 bud­get deficit tar­get of 4.6 per­cent of Gross Do­mes­tic Prod­uct (GDP) and com­pen­sate for a fall in rev­enue.

The gov­ern­ment said last week that higher debt re­pay­ments next year will re­duce its abil­ity to in­crease eco­nomic growth.

The gov­ern­ment has blamed ‘colos­sal bor­row­ing’ by the pre­vi­ous ad­min­is­tra­tion for a spike in its debt-ser­vic­ing costs. The pre­vi­ous gov­ern­ment bor­rowed heav­ily to re­build in­fra­struc­ture af­ter a 26-year civil war ended in 2009.

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