COLOMBO – Sri Lanka has recorded a budget current account surplus in the first nine months of 2025, marking a rare fiscal achievement as government revenues outpaced recurrent expenditure for the first time in decades, according to data released by the Ministry of Finance.
From January to September 2025, total government revenue rose by 31.1% to Rs 3,827 billion, driven primarily by a 32.5% increase in tax revenue amounting to Rs 3,563 billion, while non-tax revenue grew by 14.8% to Rs 264 billion.
Recurrent expenditure, including public sector salaries and welfare spending, increased by 11.2% to Rs 3,821 billion. Despite the rise in spending, particularly under the Aswesuma welfare program designed to support households affected by the 2022–23 economic crisis, the government managed to record a R. 6 billion surplus in the current account of the budget.
This surplus represents a significant turnaround for a country that has historically run large current account deficits, often reaching several hundred billion rupees by the third quarter.
Analysts attributed the fiscal improvement to enhanced tax collection, tighter spending controls, and improved monetary stability over the past two years. The central bank’s efforts to maintain relative exchange rate stability and contain inflation have also contributed to the fiscal discipline seen in 2025.
Sri Lanka’s capital expenditure, however, remained modest at Rs 455 billion, slightly down from Rs 463 billion in the same period last year. The overall budget deficit stood at Rs 441 billion, a 55% reduction compared to 2024.
While fiscal consolidation has shown progress, economists cautioned that maintaining the surplus through the end of the year will depend on spending trends in November and December, when final disbursements and adjustments are typically made.
If Sri Lanka sustains the surplus through December, it would mark the country’s first annual budget current account surplus since 1989, signalling a potential turning point in its long struggle with fiscal instability.
-ENCL
Comments are closed, but trackbacks and pingbacks are open.