Sri Lanka debt default has begun, says rating agency

Sri Lanka is about to default on its debts, two of the world’s largest credit rating agencies have warned, BBC reported.

Fitch Ratings lowered its assessment of the South Asian nation, saying “a sovereign default process has begun”.

S&P Global Ratings made a similar announcement and said that a default is now a “virtual certainty”.

This week, Sri Lanka said it will temporarily default on its foreign debts as it faces its worst economic crisis in more than 70 years.

Meanwhile, faced with mass protests over major power cuts and the soaring cost of food and fuel, officials have urged Sri Lankans working abroad to send money home.

The new governor of the country’s central bank appealed for donations in sterling, US dollars and euros on Wednesday.

He said the money “will be utilised only for the purpose of importation of essentials such as food, fuel and medicine”.

On Monday, Sri Lanka is due to make $78m (£59.4m) of interest payments on its international sovereign bonds.

If the payment is not made within a 30-day grace period it would mark the country’s first default on its foreign debt since independence from the UK in 1948.

Sri Lanka is about to default on its debts, two of the world’s largest credit rating agencies have warned.

Fitch Ratings lowered its assessment of the South Asian nation, saying “a sovereign default process has begun”.

S&P Global Ratings made a similar announcement and said that a default is now a “virtual certainty”.

This week, Sri Lanka said it will temporarily default on its foreign debts as it faces its worst economic crisis in more than 70 years.

Meanwhile, faced with mass protests over major power cuts and the soaring cost of food and fuel, officials have urged Sri Lankans working abroad to send money home.

The new governor of the country’s central bank appealed for donations in sterling, US dollars and euros on Wednesday.

He said the money “will be utilised only for the purpose of importation of essentials such as food, fuel and medicine”.

On Monday, Sri Lanka is due to make $78m (£59.4m) of interest payments on its international sovereign bonds.

If the payment is not made within a 30-day grace period it would mark the country’s first default on its foreign debt since independence from the UK in 1948.

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