Central Bank Governor Dr. Indrajit Coomaraswamy says that the islands debt situation is manageable and that no major destruction to the on- going economy development activities are foreseen, even though international rating agencies have downgraded Sri Lanka.
“We are not going to crash, it can be managed through maintaining financial discipline,” he said.
“There are signs that the much needed political stability is likely be restored and there is no doubt that these challenges and the country‘s situation are still manageable.”
The Governor was speaking at the 54 th Annual Report Awards ceremony, organised by the Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka) in Colombo, Wednesday.
However, he says that if like in the past, there are populist policies for an election, then things could get very serious.
Moody’s, Standard and Poor’s and Fitch have downgraded Sri Lanka’s already speculative grade B+ debt to B+.
“The political developments have increased the risk premium with higher costs and shorter tenors,” Coomaraswamy said.
“Room to maneuver we have had become less.”