MONETABRIEF – Sri Lanka is on the path to going back to international markets in "2027 or thereabouts", International Monetary Fund Mission Chief Evan Papageorgiou said shortly after Fitch upgraded the country's rating to B- from CCC+.
Though the latest economic numbers are still being crunched but previous assumptions about market access still stands, he said.
"We still think Sri Lanka is in a good trajectory to achieving this in 2027 or thereabouts," he told reporters Wednesday, after a review mission of the IMf program.
"And that should be the goal because, every country needs to have a good ability to access funds, both in domestic markets, as it already has, as well as international markets."
The original IMF program envisaged raising 1.5 billion US dollars from capital markets in 2027.
The upgrade of the credit rating by Fitch to B- is also a step in the right direction, Papageorgiou said.
Sri Lanka has restructured its defaulted bonds into amortizing instruments.
At the moment 2028 bonds issued for past due interest are trading below 6.3 percent.
The 2038, step up bonds are trading around 6.6 percent.
Sri Lanka also has some commercial loans which are also amortizing.
Countries can suddenly lose access to bond markets as a confidence shock triggers a sell-off. Liquidity in developing country bonds are thin, and any sell-off can lead to a rapid rise in yeilds rates.
After 18 years of stimulus and abundant reserve regime, there are also jitters about US debt. (Colombo/Sept23/2026)