Sri Lanka is to raise the gross borrowing limit and the expenditure limit for 2023 by Rs. 9,000 billion for namesake to facilitate the technical and accounting processes under the Domestic Debt Optimisation (DDO) under the Extended Fund Facility (EFF) of the International Monetary Fund (IMF), Committee on Public Finance (COPF) said.

Speaking in Parliament, member of COPF MP Patali Champika Ranawaka made these remarks. 

He added that the COPF gave the approval to the Finance Ministry on Tuesday (8) to table the amendments for the Appropriation Act No. 43 of 2022 to raise the borrowing and the expenditure limits of the Government.

He said that the approval was given following the promise made by Finance Ministry officials that no new debt will be borrowed under the amendment and would only be used to facilitate the technical and accounting processes for the DDO.

Accordingly, the gross borrowing limit will be increased to Rs. 13,979 billion from Rs. 4,979 billion, while the expenditure limit will be increased to Rs. 13,222,23 billion from Rs. 4,222.23 billion to provide allocations for the Treasury Operations Department to service debt.

Moreover, he said the borrowing and expense limits are raised to facilitate accounting methods followed when exchanging Treasury Bills for Treasury bonds and restructuring external debt.

Further, he said that under the DDO, Rs. 6,000 billion of Treasury Bonds maturing up to 2032 in selected Superannuation Funds and Rs. 3,000 billion of Treasury Bonds related to external debt are subjected to extending maturities, where the repayment period will be extended.