INSUBCONTINENT EXCLUSIVE:
or principal payment on commercial foreign currency debt
This includes its upcoming April 18 coupon payment on international sovereign bonds, or upon confirmation of debt restructuring terms.The
government said most categories of external public debts would be suspended, pending formal restructuring under a potential program
supported by the International Monetary Fund (IMF).S-P said it could lower the local currency ratings if there are indications of
non-payment or restructuring of rupee-denominated obligations
There are limited upside scenarios to the ratings currently.Upon completion of any bond restructuring, it will assign new foreign and local
external funding pressures, the country is witnessing increasingly widespread social and political protests.Although the central bank can
technically create Sri Lankan rupees to meet upcoming obligations, doing so could have significant inflationary implications
The consumer prices already grew at a rapid 17.5% year on year in February
Negotiations with the IMF to establish a reform and funding program are in the early stages.Sri Lanka has also experienced considerable
political uncertainty in recent weeks, marked by the resignation of the entire government cabinet
The governor of the CBSL also quit in early April.Failure to establish a sustainable government could further complicate and hinder progress
S-P analysts Andrew Wood and Rain Yin wrote in a statement
expedited talks with the International Monetary Fund, S-P said the negotiations appear to be in early stages
This article first appeared/also appeared in https://adaderana.lk
