Government expects public investment to jump to 9.5 percent of GDP this year and says debt moratorium will give over US$ 500 million in BOP support

Sri Dharanee Performance Arts Theatre

Government expects public investment to jump to 9.5 percent of GDP this year and says debt moratorium will give over US$ 500 million in BOP support. Government expects public investment to jump to 9.5 percent of GDP this year and says debt moratorium will give over US$ 500 million in BOP support. Treasury Secretary P. B. Jayasundera said reconstruction after the Tsunami would cost up to Rs. 1.8 billion on his return from the meeting of Paris creditor nations.

He said debt moratoriums and IMF support would give stability on the BOP side and more room for budgeting.

The International Monetary Fund board agreed to a request by Sri Lanka on Friday for an extension on debt repayment this year, which will save the country US$ 113.5 million.

The fund said the moratorium on interest and capital payment was granted because the tsunami disaster has altered the economic outlook by increasing vulnerability for Sri Lanka this year.

Economists’ say the payment extension by the IMF will help strengthen the rupee and ease balance of payment difficulties like those that affected the country last year.

The Treasury Secretary says balance of paymen