• Thu. Jul 25th, 2024

Sri Lanka Will Manage its looming debt crunch without IMF Support – Cabraal

The State Minister of Money Capital Markets and State Enterprise Reforms Ajith Nivard Cabraal reiterated that the Government is able to manage the debt servicing with the available without resorting to seeking the support of the International Monetary Fund (IMF).

He shared these remarks at the Parliament yesterday.

“There are many trying to push us towards the IMF; so we are forced to sell our national resources, cut down the public service, depreciate the Rupee and take the Government towards failure — but we will not allow that to happen, he said.

The government is increasingly relying on syndicated loans from China as an alternative to IMF financing as well as an option to reduce their reliance on sovereign debt issuances.

Amidst sovereign downgrades by rating agencies and deterioration in fiscal account heightened Sri Lanka’s credit risk and default fears.

In the latest country report, EMFI Securities projected Sri Lanka’s debt-to-GDP ratio to reach 95.6% at the end of this year.
However, Cabraal insisted that Sri Lanka would maintain its debt-to-GDP ratio below 90%.

In EMFI Core Index, Sri Lanka’s USD denominated sovereign bonds underperformed by 19.9% in October and 26.8% in September.

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