Economy Forward

Article's Purpose and Background The purpose of this article is to raise public concerns over  the design of Eurobonds issued in derivative/hedging form in exchange for defaulted International Sovereign Bonds (ISBs) in contrast to the standard government practice of plain vanilla debt instruments,  their legality and  the authorities responsible for possible financial and economic losses including new default events possible in the future, given the complex derivative nature of Eurobonds. The article shows that the so-called ISBs restructuring after wasting 32 months in default on 12 April 2022 is nothing but the extension of repayment time from 2022-2030 to 2030-2038 with greater financial risks due to the exchange of hedging contracts for defaulted ISBs with foreign investors where financial benefits and national wonders promised by the authorities from time to time are great lies. The short background of the article is as follows. 1. The Ministry of Finance (MOF) press...

  Background of the article The new government that has been labelled as the conventional leftist has chosen the IMF-Dollar debt based restructuring of the economy. This is intended to enter the dollar-based international capitalism as the country's new growth model.  Last two days, the govt. announced two new policies of seeking government efficiency, primarily through restructuring of 166 non-commercial state institutions, and Clean Sri Lanka through the state and private sectors.  The govt efficiency policy is clear from the Cabinet meeting held 19th  (Download the short video here)  and the President's speech on the status of public service yesterday  (Download the short video here) . Meanwhile, the whole US November 2024 Presidential election campaign of Donald Trump with the support of Elon Musk primarily promised two policies, i.e., to boost the Dollar to be the global reserve currency again and setting up a department of government efficiency t...