gossip lanka

Sri Lanka Reiterates its Commitment to Meeting all its Financial Obligations

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.
The Government wishes to categorically deny all such baseless claims, and would like to reiterate to all stakeholders that Sri Lanka will duly honour all its debt service obligations in the period ahead.

The recent volatilities in yield levels of 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.

The Government also wishes to clarify that the unintended delay in holding the general elections and the submission of the government budget must not be considered as leading to any policy uncertainty or procedural standoff, but a result of the health policy response to contain the Covid-19 pandemic. According to the country’s constitution, His Excellency the President is empowered to authorise the government operations in the absence of an annual budget for a period up to three months after convening the Parliament following the elections. Thus, the government operations function without any hindrance, and any uncertainty surrounding the date of holding the general elections will be resolved after the ruling by the Supreme Court on the same in the coming days.