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Debt crisis: Sri Lanka's interest-rate trap

High interest rates are worsening Sri Lanka’s debt crisis rather than easing it. Economists warn that the country’s restrictive monetary policy is delaying the recovery of an economy already scarred by conflict.

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Arjun Jayadev, Ahilan Kadirgamar, J.W. Mason
23. November 2025
Arjun Jayadev is Professor of Economics at Azim Premji University, India.

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Last updated: 23. November 2025