Sri Lanka's prime minister shot back at economists who called out the country as among Asia's most vulnerable to global emerging market volatility.
The South Asian nation is building longer term financial stability by diversifying its exports beyond tea and apparel and into higher-value goods and services, Prime Minister Ranil Wickremesinghe told CNBC on the sidelines of the World Economic Forum on ASEAN in Hanoi, Vietnam on Tuesday.
Despite concerns voiced earlier this month by ratings agency Fitch about a "challenging" external debt servicing outlook, high government debt and political uncertainty following regional polls, Wickremesinghe said he didn't believe Sri Lankan sovereign bonds were on the verge of a downgrade.
"We and many others are running deficits in Asia and that certainly would be a matter of concern, but so far we have been able to negotiate with the rating agencies and it has certainly not affected our borrowing capacity," he said.
Sri Lanka's government debt remains high at around 77 percent of GDP.
Japanese bank Nomura Holdings on Monday identified Sri Lanka as one of 30 emerging markets most susceptible to an exchange rate crisis, a claim vehemently denied by Sri Lanka's central bank and Wickremesinghe, who called it "false."
Both took particular exception at Nomura's initial short-term external debt estimate of $160 billion, a figure Nomura later admitted was inaccurate. The bank issued a corrected number of $7.5 billion as of the first quarter. When asked about the official figure, Wickremesinghe put it at $14.2 billion, though the time period was unclear. The higher number could also be due to officials using a broader measure of external debt.