Crisis-hit Sri Lanka slams latest credit rating downgrade

Crisis-hit Sri Lanka slams latest credit rating downgrade

AFP

COLOMBO: Sri Lanka accused international rating agencies of undermining efforts to rebuild its cash reserves on Thursday after S&P warned the island’s stricken economy risked a sovereign debt default.
Supermarkets are rationing food and power utilities have imposed rolling blackouts in a slow-burning crisis sparked by the Covid-19 pandemic’s impact on tourism and a drop in foreign remittances. Dwindling foreign exchange reserves have left the country unable to pay for essential imports, and S&P Global’s Wednesday downgrade reflected questions over whether the government could service its $35 billion foreign debt.
The Central Bank said it was “perturbed” by Wednesday’s decision and reiterated pledges to honour all debts, including $1.5 billion of sovereign bonds maturing this year. S&P was the third of the “big three” international ratings agencies to downgrade Sri Lanka since October, following Moody’s and Fitch.