The Central Bank of Sri Lanka (CBSL) will take the necessary steps to upgrade the country’s sovereign rating from the current B+ (stable)/B (positive) to an investment grade of BBB- or higher over the next four year period.

A bond is considered Investment Grade or IG if its credit rating is BBB- or higher by Standard & Poor's or Baa3 or higher by Moody's or BBB (low) or higher by DBRS. Generally they are bonds that are judged by the rating agency as likely enough to meet payment obligations that banks are allowed to invest in them.

Ratings play a critical role in determining how many companies and other entities that issue debt, including sovereign governments, have to pay to access credit markets, i.e., the amount of interest they pay on their issued debt.

The threshold between investment-grade and speculative-grade ratings has important market implications for issuers' borrowing costs.

The Central Bank towards this end a carefully designed, forward looking and effective strategy with the participation and co-operation of the all stakeholders, country authorities, private sector business leaders, chambers and rating advisors, will be implemented.

For this purpose, the CBSL has now appointed a high level Sovereign Rating Committee, which will make regular reviews on the developments of the economy and convey these improvements to the rating agencies through rating advisors to upgrade the country’s rating level, CB states.