Government has appointed a steering committee in a renewed push to obtain a sovereign rating ahead of attempts to tap the international market for debt to lower the borrowing cost. Government has appointed a steering committee in a renewed push to obtain a sovereign rating ahead of attempts to tap the international market for debt to lower the borrowing cost. The steering committee that has got Cabinet sanction will soon look for a financial advisor to help the government in the process.
“Usually the ground work and fact finding process take about–three to four months. Before the end of this year or before the budget we hope to obtain the sovereign rating. Once we got the rating when we enter the capital markets is a matter for the government to decide,” says Dr. Ranee Jayamaha, Deputy Governor, Central Bank.
Central Bank is helping the government to obtain the rating.
Past issues of dollar denominated development bonds were brought mainly by locally based financial institutions.
The government is planning to tap the international market to retire some of the older more expensive dollar debt and to streamline the borrowing program.
“The government is anxious pay up some of the debt which has been borrowed at higher rates -that is also part of the good debt management.
In 2004 we have elevated our country to a middle income earning country with the per capita income of US$ 1000. In such a situation we shouldn’t be going to the commercial lender for short term high cost and ad hoc kind of borrowing,” says Dr. Jayamaha.
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