Govt. mulls another $500 mln bond
View(s):Sri Lanka will float another US$500 million long term international sovereign bond to finance counterpart funds required for various development projects and to maintain cash flows if the (earlier) $1 billion bond raised by the Central Bank is fully exhausted on ongoing projects.
Official sources revealed that the 2014 budget has provisions for this purpose and the Finance Ministry will issue a directive as and when the need for such financing is arisen. A senior Central Bank official told the Business Times that the $1 billion bond was raised earlier this month in line with the budget considering the favourable international bond market but it will not be used to service foreign debt.
The money will be credited to the consolidated fund of the Treasury. The next servicing of a bond will be in 2015 when the $500 million bond raised in October 2009 matures, he said adding that this year there is no bond payment needed. Bond issues were suspended last year as foreign borrowings with restrictions in the 2013 budget which have now been lifted.
The 2014 budget proposed to float a $750 million long term international bond for government urban and estate housing schemes and a further $750 million to finance the counterpart funds required for various development projects.
Sri Lanka has so far issued five bonds worth $4 billion since 2007.