Sri Lanka CB Chief confident of meeting debt repayment targets in 2019

Nov 14, 2018 (LBO) – Political uncertainty will not have an impact on Sri Lanka’s debt repayment preparations for 2019, the Central Bank Governor said.

“Despite the uncertainty we have been operating with business as usual, ” Dr. Indrajit Coomaraswamy, Governor, Central Bank told reporters in Colombo, Wednesday.

“CB is ready to cover the January 15th international sovereign bond repayment.The Bank of Ceylon, People Bank and National Savings Bank are in talks to raise about 750 million dollars to 1 billion dollars from Middle Eastern banks by the end of the year.”

Sri Lanka also has another 500 million dollar bond maturing in April, he said.

“To repay this we plan on extending an agreement we have with the China Development Bank by another 500 million dollars.”

Dr. Coomaraswamy said that Sri Lanka would annually require four billion dollar to settle foreign debts, which will likely persist till the year 2022, as well as to accommodate the government’s future requirements.

The governor also touched on the enforcement of the Liability Management Act, which provided flexibility to assist the economy build buffers.

However, the Liability Management Act comes with tight supervision and requires the Cabinet and Parliament approval.

This framework helps us to address the bunching efforts starting from next year. However, to do all this, we need to maintain our ratings and access to international capital markets, he said.