Sri Lanka has declared a default

Anna Kholodnova

Sri Lanka has warned investors about default and has stopped paying off foreign debt.

This was reported by Bloomberg.

This step was taken to preserve the declining dollar reserves needed to import basic food and fuel.

The countryʼs Finance Ministry has said that all payments to bondholders, bilateral creditors and institutional creditors will be suspended until debt restructuring.

The newly appointed chairman of the Central Bank, Nandalal Virasinghe, said at a briefing that the government wants to negotiate with the creditors.

The economic crisis has led to mass protests in the country.