{"id":70754,"date":"2020-10-25T21:45:14","date_gmt":"2020-10-26T02:45:14","guid":{"rendered":"http:\/\/dbsjeyaraj.com\/dbsj\/?p=70754"},"modified":"2020-10-26T12:30:29","modified_gmt":"2020-10-26T17:30:29","slug":"sri-lankas-government-bonds-fell-heavily-on-friday-after-the-united-states-urged-the-countrys-government-to-make-difficult-but-necessary-choices-regarding-its-ties","status":"publish","type":"post","link":"https:\/\/dbsjeyaraj.com\/dbsj\/?p=70754","title":{"rendered":"Sri Lanka\u2019s government bonds fell heavily on Friday after the United States urged the country\u2019s government to make \u201cdifficult but necessary choices\u201d regarding its ties with China."},"content":{"rendered":"

By Marc Jones<\/strong><\/p>\n

LONDON, Oct 23 (Reuters) –<\/strong> Sri Lanka\u2019s government bonds fell heavily on Friday after the United States urged the country\u2019s government to make \u201cdifficult but necessary choices\u201d regarding its ties with China.<\/p>\n

Worries that this year\u2019s COVID-19 crisis could see the country struggle to pay its debts have already seen its bonds slump almost 40% this year.<\/p>\n

On Friday its 2021 and 2022 dollar-denominated bonds dropped 5 cents or more, according to Tradeweb data. Meanwhile its 2025 and 2026 bonds dropped below the 60 cents on the dollar threshold.<\/p>\n

<\/p>\n

\u201cWe encourage Sri Lanka to review the options we offer for transparent and sustainable economic development in contrast to discriminatory and opaque practises,\u201d U.S. State Department official Dean Thompson told reporters ahead of Secretary of State Mike Pompeo\u2019s visit to Sri Lanka and other parts of Asia next week.<\/p>\n

\u201cWe urge Sri Lanka to make difficult but necessary decisions to secure its economic independence for long-term prosperity,\u201d Thompson added.<\/p>\n

China\u2019s foreign ministry spokesman dismissed the comments as showing a \u201cCold War mentality\u201d and said the U.S. was bullying countries to pick sides over their ties.<\/p>\n

Sri Lanka\u2019s finances were fragile long before the coronavirus blow, but unless the country can win support from its allies it runs the risk of having to default.<\/p>\n

All the tell-tale crisis signs are there: a tumbling currency, credit rating downgrades, bonds at half their face value, debt-to-GDP levels nearing 100% and almost 70% of government revenues being spent on interest payments alone.<\/p>\n

Sri Lanka\u2019s central bank has repeatedly vowed however that the country will \u201chonour all its debt service obligations\u201d.<\/p>\n

External debt payments between now and December amount to $3.2 billion. Other costs could bring that up to $6.5 billion in the next 12 months, analysts estimate, while its FX reserves of just $7.4 billion leave it barely covered.<\/p>\n

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By Marc Jones LONDON, Oct 23 (Reuters) – Sri Lanka\u2019s government bonds fell heavily on Friday after the United States urged the country\u2019s government to make \u201cdifficult but necessary choices\u201d regarding its ties with China. Worries that this year\u2019s COVID-19 crisis could see the country struggle to pay its debts have already seen its bonds …<\/p>\n

Continue reading ‘Sri Lanka\u2019s government bonds fell heavily on Friday after the United States urged the country\u2019s government to make \u201cdifficult but necessary choices\u201d regarding its ties with China.’ »<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[12],"tags":[],"_links":{"self":[{"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/posts\/70754"}],"collection":[{"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=70754"}],"version-history":[{"count":1,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/posts\/70754\/revisions"}],"predecessor-version":[{"id":70755,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=\/wp\/v2\/posts\/70754\/revisions\/70755"}],"wp:attachment":[{"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=70754"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=70754"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dbsjeyaraj.com\/dbsj\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=70754"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}