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Piling debt and falling reserves – Sri Lanka’s crisis deepens

Colombo faces loan repayments of US$2.9 billion this year alone as debts continue to grow and the economy struggles in the aftermath of the coronavirus pandemic, reports The Hindu this week.

Sri Lanka’s current foreign debt repayments debt alone amount to 42.6% of the country’s GDP in 2019, The Hindu said, with approximately $960 million owed to India and $5 billion to China in 2018.

“With a $1 billion-international sovereign bond maturing in October, the alarm bells are already ringing in Sri Lanka,” it added.

See more from The Hindu here.

The debt repayments come after Fitch Ratings downgraded Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDR), a move that sparked a backlash from Sri Lanka’s Central Bank.

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