Post-war progress may beat financial risks- Moody’s

Though Sri Lanka’s financial strength is “low” on account of its large debt burden, the improved post-conflict environment may offset it, according to the international rating agency, Moody’s Investor Service.

“Our assessment of government financial strength is “low” on account of the large debt burden, heavy debt service requirements and lingering external vulnerabilities. However, these risks are offset by post-conflict improvements in domestic competitiveness and growing foreign investor interest,” a recent report by Moody’s on country’s credit situation noted.

It also said that both these factors should support Sri Lanka’s balance of payments position and the fiscal reforms that have already started will lower future budget deficits.