Reserves Surge from Crisis-Era US$1.8 Bn to US$6.9 Bn

COLOMBO (News 1st); Sri Lanka's gross official foreign reserves have risen from just US$1.85 billion during the height of the country's economic crisis in June 2022 to US$6.9 billion by August 2026, according to Deputy Minister of Finance and Planning Dr. Anil Jayantha.

Responding to a question in Parliament, the Minister outlined the steady improvement in the country's reserve position over the past four years, noting that reserves have increased significantly despite fluctuations during the period.

Dr. Jayantha said the responsibility for managing Sri Lanka's foreign reserves lies with the Central Bank of Sri Lanka under the provisions of the Central Bank Act No. 16 of 2023. He added that the country's gross official reserves include the People's Bank of China swap facility, while most reserve assets remain readily available to meet debt servicing requirements and support the domestic foreign exchange market when necessary.

The Minister also referred to reserve projections contained in the International Monetary Fund's Extended Fund Facility programme review, which estimate Sri Lanka's gross official reserves at US$8.64 billion in 2026, US$11.78 billion in 2027, US$13.34 billion in 2028 and US$14.47 billion in 2029.

However, he stressed that these projections are the IMF's estimates and should not be interpreted as forecasts or targets set by the Sri Lankan authorities. He further clarified that gross official reserves themselves are not a target under the IMF programme, with the relevant benchmark instead being net international reserves.

Addressing questions regarding future borrowing, Dr. Jayantha said assumptions contained in IMF projections relating to sovereign bond issuances do not represent government policy. He noted that any decision on whether Sri Lanka returns to international bond markets will be taken based on prevailing economic conditions and assessments carried out by the government.

The Minister further revealed that outstanding foreign exchange swaps stood at US$4.1 billion as of May 2026, consisting of US$1.8 billion in international swaps and US$2.3 billion in domestic swaps. He added that most domestic swap obligations are scheduled to mature within one year.