Sri Lanka plans US$1.2bn Samurai bond sale: Prime Minister
ECONMYNEXT – Sri Lanka is planning a $1.2 billion sale of Japanese Yen-denominated securities also known as ‘Samurai’ bonds, Prime Minister Ranil Wickremesinghe told parliament.
‘Samurai bonds’ are sold in the Japanese domestic market by foreign entities.
Wickremesinghe’s told parliament on Thursday that Sri Lanka also planned to sell $3.0 billion in sovereign bonds. Sri Lanka has also said it wanted to sell ‘Panda bonds’ or Renminbi-denominated bonds in the Chnese domestic market this year.
It is not clear whether Sri Lanka can sell all the bonds during this year, where the limit of commerical borrowing is about $3.5 billion, according to the Finance Minister.
The Japanese Yen has a low interest rate, reflective of the productivity and savings propensities of the country, and the currency also tends to appreciate over time, defying attempts by the country’s Central Bank to weaken the currency at times.
However, many of Sri Lanka’s development projects have been financed by Yen loans, including ports, roads and airports. (Colombo/June10/2016)