SL becomes first Asia Pacific country to default on foreign debt

While the foreign exchange crisis becomes severe in Sri Lanka, the island nation becomes the first country in the Asia Pacific region to default on foreign debt this century.

According to Moody’s, the

Central Bank of Sri Lanka (CBSL) announcing it has missed a foreign debt repayment deadline, places the island nation in this position, the Financial Times reported yesterday.

As Sri Lanka continues to look for avenues to conserve its foreign reserves for the importation of fuel, medicine, and food, the government made a decision last month to stop its international debt repayments.

The default is the first for Sri Lanka, as it has never missed a repayment before. The island nation owes about US$ 51billion in foreign debt to international bondholders as well as bilateral creditors including China, Japan and India.