Govt. reiterates commitment to meeting all its financial obligations

„Dismisses inferences made in recent media reports questioning govt.’s ability to honour its debt obligations

Responding to the inferences made in recent media reports questioning the government’s ability to honour its debt service obligations, the Central Bank yesterday reiterated the government’s commitment to meeting all its financial obligations.

“…the government emphasises that Sri Lanka has demonstrated its commitment to honouring all its obligations on time, even during difficult times in the past and will continue to do so in the future, while engaging with all investment and development partners,” the Central Bank said in a statement.

The statement added that contrary to the unfounded inferences and comparisons, Sri Lanka has already initiated measures to return to normalcy and gradually being opened up for business throughout the country.

“In this backdrop, the Government of Sri Lanka categorically disagrees with the recent assessments of risks and rating decisions by some international rating agencies.”

The Central Bank also noted that the recent volatilities in yield levels of the Government of Sri Lanka’s International Sovereign Bonds (ISBS) during the COVID-19 pandemic period are no different to what has been observed across a majority of emerging and frontier market economies.

“It is noteworthy that despite such volatility, global institutional investors, fund managers and analysts recommend Sri Lankan debt instruments for investment, while remaining confident of Sri Lanka’s credit quality.”

Read the full statement here.

The Government of Sri Lanka finds inferences in recent media reports questioning its ability to honour its debt service obligations. The government notes with dismay such inferences made by certain media to imply that Sri Lanka is at risk of falling into a sovereign debt crisis by comparing Sri Lanka with other sovereigns, which are said to be in similar situations.