In this issue

The reality of Sri Lanka’s debt

Moody’s, Fitch and S&P all cut Sri Lanka’s credit rating by a notch in December 2018 when a political coup installed a second Prime Minister. Since then the three rating agencies have cut Sri Lanka’s credit ratings twice, essentially locking the country out of the global credit markets.

The problem is that the refinancing option occasionally proves to be fragile. Sometimes, like in Sri Lanka’s case, it is the country’s own economic management that causes markets to turn skittish. At other times, its causes are quite outside the ability of the sovereign debtor to effect. An unexpected geopolitical crisis, a Lehman moment, interest rates in the developed world rising, can all trigger markets.

When the signs were ominous, Sri Lanka should have suspended debt service payments. The credit rating downgrades following the Covid pandemic’s spread should have been the cue. By then it was evident the country could not refinance its debt.

If there is a constant theme in sovereign debt crises over the last 40 years, it is that countries have put off the decision to restructure their debt for as long as possible. Putting off the decision creates what is called a subordination problem.

In October 2020 and July 2021 Sri Lanka repaid, using its reserves, two maturing sovereign bonds of a billion dollars each. It also repaid other dollar debt and interest of at least 900 million dollars in the last year. By paying in full some creditors, it will now have to force far deeper haircuts on the debt it cannot fully service in the future. By its not facing reality, Sri Lanka is forcing narrower and starker choices upon itself.

Echelon Magazine Description:

Intelligent Storytelling

The one thing that will define the Echelon magazine will be the quality of the storytelling. Echelon,published monthly, will cover in depth Sri Lanka’s most successful businesses, examine their winning strategiesand profile their leaders in immersive stories. Great stories are also never limited to words, and our approach includes rich photography, bold graphics and leading edge design which together will make for a compelling read.

But business doesn’t start and end in a boardroom;it extends to the golf club greens, to international travel and to pursuits that blurthe lines between commercial venture and sheer passion. The Echelon team will present the best in business and lifestyle coverage that will appeal to an exclusive and affluent readership: an otherwise hard to reach demographic.

Content will be developed by one of the most experienced and proven teams of editors, financial journalists, photographers and designers in the country.This team has already raised the bar for powerful and expertly crafted business news. Shamindra Kulamannage, will lead the editorial team.

The reputation of Echelon is being built on the separation between editorial and advertising. However we are also looking for the most creative and impactful new formats that can be applied in our magazines, iPad app as well as website to help our clients reach our audience. We are flexible and creative and we will have a solution for every single advertiser who wants to reach our audience.

We are passionate about creative results and about working with our advertisers to help them create bespoke multi platform creative solutions with our in house creative team and of course our sales team.

Echelon will be a great place to show off the products and capabilities of our clients because they will be surrounded by an editorial product that is expertly crafted, full of integrity and intelligence.