Sri Lanka can build reserves and continue repaying debt even with vehicle imports reaching 1.5 billion US dollars annually, according to Central Bank Governor Nandalal Weerasinghe. In 2024, the Central Bank estimates that relaxing commercial vehicle imports would require about 500 million US dollars in foreign exchange, with private vehicle imports potentially needing an additional billion dollars a year.
Governor Weerasinghe assured that even with vehicle imports totaling 1.5 billion dollars, the country could maintain reserves, make debt payments following debt restructuring, and balance government revenues. He acknowledged that there might be a small deficit in the current account, though it has been significantly lower in comparison to past deficits.
Sri Lanka’s private banks repaid debt, the Central Bank built reserves, and the government continued servicing multilateral debt, even when bilateral debt flows were halted. The country’s debt repayment and monetary stability, restored in late 2022, led to a surplus in the financial account due to prudent interest rate policies.