On Wednesday, China said that it would “play a positive role” in aiding bankrupt Sri Lanka to get through its debt concern after deciding to restructure its loans. An unparalleled economic crisis has seen Sri Lanka’s 22 million people suffer critical food, fuel, and medicine shortages, along with vast blackouts and runaway inflation.
China is ready to work with relevant countries and international financial institutions to play a positive role in helping Sri Lanka cope with its current difficulties, ease its debt burden and achieve sustainable development.”
Mao Ning-foreign ministry spokesperson at a regular briefing.
When asked about President Ranil Wickremesinghe’s Tuesday statement that Beijing had agreed to help she said that on March 6, the Export-Import Bank of China, as the official bilateral creditor, issued a financial assurance letter to Sri Lanka. She added that China supports relevant financial institutions in actively discussing debt disposal plans with the Sri Lankan side.
Wickremesinghe’s government has been performing to improve Sri Lanka’s shattered finances and secure a sorely required IMF recovery package. But it was held up by debt negotiations with China, Sri Lanka’s largest bilateral creditor. Beijing’s assurance that it would support removes the final obstacle to a long-awaited International Monetary Fund bailout.
Sri Lanka has now received financing assurances from all major bilateral creditors.”
Krishna Srinivasan-director of the IMF‘s Asia and Pacific Department
