COLOMBO: S&P Global Ratings downgraded Sri Lanka by one notch on Friday as international credit agencies worried over the island’s ability to service its foreign debt.
The New York-based agency said Sri Lanka’s existing funding sources did not appear sufficient to cover its debt servicing needs estimated at just over $4.0 billion next year. “This means that Sri Lanka may need external commercial funding, which can be difficult and costly,” the ratings agency said in its latest report on the island.
“We see increasing indications that funding from multilateral or bilateral partners will not be sufficient to cover external financing needs over the next 12 months.”
The negative credit report came just two weeks after Fitch cut Sri Lanka’s credit score expressing similar fears over Colombo’s ability to repay its foreign loans.
Two months ago, Moody’s had also downgraded Sri Lanka by two notches, saying Colombo would struggle to secure funding. — AFP
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