A case study by VeriteResearch identified 3 main problems in debt reporting in SriLanka:
These infographics provide insight into each of these issues.
SOE debt is not included when reporting on the debt obligations of Sri Lanka to China.
Thus, debt owed by Sri Lanka to China is underestimated in the public reporting.
Including SOE debt raises our debt obligations to China by 60%.
Loans that were initially recorded by the central government have been transferred to several SOEs in Sri Lanka.
These movements result in the central government stating debt at a lower value, even though the actual value of public debt is unchanged.
The outstanding debt balance of the Hambantota Port Development project has been frequently transferred between the Treasury and Sri Lanka Ports Authority (SLPA).
Recently the National Audit Office discovered that neither SLPA nor the Treasury currently records the outstanding debt for this project.