Sri Lanka Retains S&P Sovereign Rating with Stable Outlook Despite External Pressures
July 30, Colombo (LNW): S&P Global Ratings has reaffirmed Sri Lanka’s sovereign credit rating at ‘CCC+/C’ while maintaining a stable outlook, signalling confidence in the country’s ability to preserve macroeconomic stability despite a series of external challenges.
Commenting on the latest assessment, Deputy Minister of Finance and Planning Dr Anil Jayantha Fernando described the decision as an encouraging indication that Sri Lanka’s economic recovery remains on course. He said retaining the existing rating under difficult global and domestic conditions reflects the resilience of the country’s financial management and ongoing stabilisation efforts.
According to the Deputy Minister, the Government has succeeded in maintaining creditworthiness despite facing two significant external shocks. He pointed to the widespread economic impact of Cyclone Ditwah, which affected large parts of the country, as well as continued uncertainty stemming from the conflict in the Middle East, both of which have placed additional strain on the economy.
He noted that preserving the sovereign rating under such circumstances sends a positive message to investors and international financial institutions, demonstrating Sri Lanka’s commitment to sustaining fiscal discipline and implementing economic reforms.
In its latest assessment, S&P also confirmed that the outlook on Sri Lanka’s long-term foreign and local currency sovereign ratings remains stable. At the same time, the agency upgraded the country’s Transfer and Convertibility Assessment to ‘B-‘ from ‘CCC+’, reflecting an improved view of Sri Lanka’s ability to facilitate foreign currency transactions, including the repatriation of investment earnings and the servicing of external debt obligations.
The latest rating action is expected to provide further reassurance to markets as Sri Lanka continues its efforts to strengthen economic recovery and restore investor confidence.
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