Verité Research, “fact checking” and protecting interests of financial elites in Sri Lanka

The only persons who have benefited from the DRA in Sri Lanka are the financial elites 

The Debt Restructuring Agreement (DRA) entered into by the National People’s Power Government is disastrous for Sri Lanka. This is a fact that has been confirmed repeatedly by globally reputed economists such as Jayati Ghosh, C.P. Chandrasekhar, Charles Abugre, former Staff Economist of the United States Department of the Treasury Brad Sester, as well as Sri Lankan economists such as Dhanusha Gihan Pathirana, Kalpa Rajapakse and Amali Wedagedera. 

In my role as a trade unionist and an Executive Committee member of the People’s Struggle Alliance, with a deep interest in the welfare of ordinary Sri Lankans, I have echoed this broad acceptance that the DRA is bad for Sri Lanka. Verité Research, a registered company and a thinktank, recently decided to make a social media spectacle out of a statement I made to the same effect. At a public meeting for the People’s Struggle Alliance on 8 December 2024, I said: 

“Usually, public debt is reduced during debt restructuring. In Sri Lanka, we are going to repay 14% more of the existing debts to the creditors.”

Verité’s ‘Fact Check’ published a dramatised and defamatory series of posts in and around 27 March 2025, declaring this statement as ‘False’ on Instagram, Facebook and X, and their own website. In an email sent to me signed by the ‘FactCheck.lk Team’ of Verité Research, I was also given the following firm instruction:

Verité Research analysis debunked months ago

“In light of the inaccuracies identified in the claim, we kindly encourage you to consider issuing a statement to clarify or correct the claim, using the analysis provided by FactCheck.lk.”

Verite’s ‘Fact Check’ makes much analysis of how I made my ‘error’. Verité Research has become the recent darling of politicians, civil society organisations and even some trade unions, and has seemingly assumed the authority to command public figures on what data to use. I am, however, compelled to inform the public that the analysis made by Verité Research was in fact debunked many months ago. 

The November 2024 publication of ‘Policy Perspectives’ by the Institute of Political Economy featured an article authored by economist Dhanusha Gihan Pathirana titled ‘Sri Lanka’s International Sovereign Bond Restructuring – The Need to Avoid Debt Traps’. This article reached a wide audience, including Opposition leader Sajith Premadasa who quoted it in length in his Parliamentary intervention in December 2024 questioning the NPP Government’s rationale in continuing with the DRA entered into by the Ranil Wickremesinghe Government.

In the article, Pathirana sets out two probable scenarios setting out clearly why the actual repayment over a period of eight years would exceed what we already had to pay prior to the debt restructuring. In the statement in question, I was quoting the first scenario when I had said Sri Lanka would end up paying 14% more to external creditors than before the DRA which is being enforced now. 

In the same article Pathirana critiques the use of the Net Present Value (NPV) analysis which has been used by the IMF and thinktanks such as Verité Research themselves. Pathirana argues that the assumptions used in the NPV method are ill suited for third world countries like Sri Lanka as their currencies are likely to depreciate over time thereby increasing the cost of future debt repayment denominated in dollars. Pathirana is therefore citing the very analysis done by companies such as Verité Research in stating that “discounting cash flows in NPV analysis can hence incorrectly show a reduction in payments for the debtor nation due to restructuring.”

Financial elites 

The data produced by Verité Research is at best ignorant of basic economic ideas, but at worst misleading and politically skewed. Such analysis serves the interests of the financial elite in this country who have, in fact, made a killer deal through this DRA. The DRA was heavily pushed by Sri Lankan financial elites, including people such as Duminda Hulangamuwa, Chairman of the Ceylon Chamber of Commerce (CCC), whose obvious conflicts of interest, in being involved in the Government team to negotiate the DRA and acting as a Senior Economic Advisor to the President whilst working as the Country Managing Partner for the multinational accounting firm Ernst and Young, are just now coming to be publicly recognised. 

Of equal concern is how many members of the CCC also own International Sovereign Bonds, which makes their advocacy of the DRA even more suspect. Indeed, the only persons who have benefited from the DRA in Sri Lanka are the financial elites in this country including members of the CCC. This is not heresy, but rather facts publicly endorsed by leading economists including an Advisory Fellow to Verite Research in a recently published statement by the United Federation of Labour, of which I am the President. 

Thinktanks like Verité Research which specialise in economic issues and proclaim a public advocacy role, did little to alert the public and working people of the perilous future awaiting them as a result of the debt restructuring deal. These institutions and their functions such as ‘fact checking’ proclaim to serve a neutral, non-political role. However, episodes such as these are ultimately occasions to question their supposed neutrality and public benefit, when they clearly only serve the financial elite and safeguard the status quo, while keeping their sources of funding completely opaque. 

The political and economic crisis of the past few years has provided the rightful encouragement to question the actions, intentions and funding of many political actors. We must now clearly extend this spirit towards seemingly neutral research and advocacy organisations like Verité Research as well.

(The writer is the President, United Federation of Labour.)