News Forum - Sri Lanka poised to default on its international debt

[Thaiger]

Skyrocketing inflation, political unrest and looming debt default. Another country’s economy is now failing in what’s likely to be a year or two of falling dominoes for at-risk economies. A month of increasingly desperate headlines has culminated in two leading ratings agencies warning Sri Lanka is about to default on its national debt, a crisis that would take decades to resolve for the small nation off the south east coast of India. S&P Global Ratings says that a default is now a “virtual certainty”. Fitch Ratings has lowered its assessment claiming “a sovereign default process has begun”. For their part […]

The story Sri Lanka poised to default on its international debt as seen on Thaiger News.

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[Ramanathan.P]

I have only one thing to say....."One has to reap what one has sow".....Karma has taken its course.....

[Fanta]

I read that the inflation skyrocketing in Sri Lanka was blamed on the government forcing people to abandon agricultural chemicals to go with environmentally friendly stuff. Absolute disaster, crops failed and kaboom goes the local food economy. Must have been a pretty fragile economy to start with and the crop failures were the final straw. 

https://m.economictimes.com/news/international/world-news/sri-lanka-inflation-hits-record-14-per-cent-as-food-crisis-worsens/articleshow/89055155.cms

[palooka]

India will be watching this with interest. Maybe a new Province (orPresidency)  in India coming up.

[Ramanathan.P]

49 minutes ago, palooka said:

India will be watching this with interest. Maybe a new Province (orPresidency)  in India coming up.

May be the northern half to India and the southern half to China.....

[HolyCowCm]

$78 million is not much but they really must have sunk to the abyss. Best bet is the IMF as they are going to do talks with.

[Soidog]

China will step in and help out I’m sure.

[Paulw]

Yes the rip off IMF will come to their aid while china scoops in for more pickings, WTF!

[Ramanathan.P]

Wish IMF comes in and their genocide and ethnic cleansing case in the international court opens back.....

[Bert]

So sad, visited the place in March 2019 just before things went bad (terrorist attack, covid ...) .

Friendliest people you'll meet, I feel for them

[Pinetree]

23 hours ago, palooka said:

India will be watching this with interest. Maybe a new Province (orPresidency)  in India coming up.

SL has already sold its soul to China, inviting that lot to invest billions in infrastructure, mainly ports, airports and roads,  that they had no means of re paying.  That has all come home to roost,  Take note Thailand. 

[Poolie]

23 minutes ago, Pinetree said:

SL has already sold its soul to China, inviting that lot to invest billions in infrastructure, mainly ports, airports and roads,  that they had no means of re paying.  That has all come home to roost,  Take note Thailand. 

https://research.hktdc.com/en/article/MzYyOTQyMDc4

Guess again.

[Grumpish]

46 minutes ago, Pinetree said:

SL has already sold its soul to China, inviting that lot to invest billions in infrastructure, mainly ports, airports and roads,  that they had no means of re paying.  That has all come home to roost,  Take note Thailand. 

The bailiffs are probably already in there looking at what is worth repossessing.

[Poolie]

12 minutes ago, Grumpish said:

The bailiffs are probably already in there looking at what is worth repossessing.

Several sacks of tea?

[palooka]

37 minutes ago, Poolie said:

https://research.hktdc.com/en/article/MzYyOTQyMDc4

Guess again.

Sri Lanka: A country trapped in debt - BBC News

Some see it differently.

[Poolie]

1 hour ago, palooka said:

Sri Lanka: A country trapped in debt - BBC News

Some see it differently.

The BBC hate China. Thats why they say it  differently to a whole bunch of international economists.

They aren't known as the British Biased Company for nothing.

 

[Pinetree]

4 hours ago, Poolie said:

https://research.hktdc.com/en/article/MzYyOTQyMDc4

Guess again.

Chinese propaganda mate

[Fanta]

8 hours ago, Poolie said:

The BBC hate China. Thats why they say it  differently to a whole bunch of international economists.

They aren't known as the British Biased Company for nothing.

I think the way she says “Tweeter” was so cute.

ps: I hope that BBC lady enjoyed her butt breakfast because she was handed her own ass on a plate.

[Dr.Sivada]

21 hours ago, Soidog said:

China will step in and help out I’m sure.

Exactly! I think Sri Lanka was involved in the one belt one road initiative? Anyone that gets involved with CCP never ends well. “When they say win-win, they mean Chinese win twice…”.

[Dr.Sivada]

8 hours ago, Poolie said:

The BBC hate China. Thats why they say it  differently to a whole bunch of international economists.

They aren't known as the British Biased Company for nothing.

Of all the thousands of posts you have on this web site, I am still digging for the ones that are not CCP sympathetic. When you post propaganda like that…you really need to re-evaluate or try to disguise better.  

[Poolie]

4 hours ago, Fanta said:

I think the way she says “Tweeter” was so cute.

ps: I hope that BBC lady enjoyed her butt breakfast because she was handed her own ass on a plate.

Wasn't she just.

4 hours ago, Dr.Sivada said:

Of all the thousands of posts you have on this web site, I am still digging for the ones that are not CCP sympathetic. When you post propaganda like that…you really need to re-evaluate or try to disguise better.  

Only if I considered the western rubbish that gets absorbed by the unthinking hoi poloi to be nearer the truth. I dont, so I dont.

[AdvocatusDiaboli]

On 4/17/2022 at 9:17 AM, Soidog said:

China will step in and help out I’m sure.

Or Russia

[Noble_Design]

12 hours ago, Pinetree said:

Chinese propaganda mate

The majority of Sri Lanka's debt comes from Market Borrowing:

https://www.dw.com/en/sri-lankas-foreign-debt-default-why-the-island-nation-went-under/a-61475596

Quote

"Since graduating into a lower middle-income country in the early 2000s, successive Sri Lankan governments have been increasingly borrowing from private international capital markets through the issuance of sovereign bonds, seriously contributing to the precarity of the balance-of-payments of the country," said Dr. Muttukrishna Sarvananthan, development economist and principal researcher at the Point Pedro Institute of Development in Sri Lanka. "This capital-market borrowing is unconditional, with relatively high interest rates and much shorter durations of repayment."

Source from DW news and Department of External Resources, Sri Lanka. I think this doesn't qualify as Chinese propaganda?

[Pinetree]

2 minutes ago, Noble_Design said:

The majority of Sri Lanka's debt comes from Market Borrowing:

https://www.dw.com/en/sri-lankas-foreign-debt-default-why-the-island-nation-went-under/a-61475596

Source from DW news and Department of External Resources, Sri Lanka. I think this doesn't qualify as Chinese propaganda?

The Words biggest Sovereign Wealth Fund is Chinese ?

[Noble_Design]

4 minutes ago, Pinetree said:

The Words biggest Sovereign Wealth Fund is Chinese ?

I think this will better explain:

https://www.ft.com/content/09e1159f-9c45-4379-b862-98cb5e30a4da

Quote

Sri Lanka first tapped bond markets more than a decade ago, taking advantage of western investors’ thirst for high-yielding assets as it sought to finance reconstruction following a civil war that ended in 2009.

 

Quote

It has since become an important player in global sovereign debt markets and has borrowed billions from countries including China and Japan. Sri Lanka has never defaulted and its successive governments have been known for a market-friendly approach.

 

And over simplification for your understanding:

Sri Lanka issues government bonds -> western investors snap them up -> Sri Lanka pays the yield from tourism money and issue more bonds -> Covid-19 came and the funds to pay the yield dried up -> Sri Lanka borrows from China and Japan to pay those bonds -> Those money dried up as well -> Sri Lanka defaults on those bonds