At the end of 2020 total foreign currency obligations stood at USD 6.8 billion. This includes a settlement of USD 1 billion ISB maturing in July. “We expect the Government to roll over about USD 1.5 billion existing obligations and borrow about USD 4.5 billion via bilateral/multilateral arrangements.
“As per ICRA Lanka’s projections, in this setting total gross official reserves would fall to USD 3.8 billion by the end of 2021. Monthly exports may consistently stay over and above USD 1 billion for the remainder of 2021 beginning from June to bring total exports to USD 12.3 billion by the year-end but the troubles in the external sector will be far from over. Sri Lanka’s terms-of-trade will continue to deteriorate despite having import restrictions due to rising commodity prices.” “We expect the trade deficit to widen to USD 8 billion, current account balance to reach USD 1.4 billion, and gross official reserves would fall to USD 3.8 billion by the end of 2021.”
“We expect the state revenues to weaken to 9.1% of the GDP in 2021 from 9.2% in 2020 amid the current subdued domestic economic situation. However, the GoSL may observe gradual normalization of revenues in 4Q 2021.”