Colombo: Anxiously awaiting Beijings response for a request on debt restricting, Sri Lankan President Ranil Wickremesinghe held talks with chief of China’s Export-Import (Exim) Bank.
“Wu Fulin, Chairman of the Export-Import Bank of China, held a fruitful video conference with Ranil Wickremesinghe, President and Minister of Finance of Sri Lanka, and exchanged views on bilateral cooperation and Sri Lanka’s current debt issues,” the Chinese Embassy in Sri Lanka tweeted on Thursday.
President Wickremesinghe also discussed about Sri Lanka’s current debt issue during the talks.
“The two sides agreed to further strengthen exchanges and collaboration on the resolution of Sri Lanka’s debt issues, and help the island’s economic recovery and sustainable development,” the Chinese Embassy tweet added.
In December 2022, President Wickremesinghe said that China has requested Sri Lanka to speak to the (Exim Bank with regard to the debt restructuring process.
In September, the International Monetary Fund (IMF) agreed to provide $2.9 billion over four years to help salvage the country from its worst economic crisis but Sri Lanka must arrange debt structuring with its debtors mainly China, India and Japan.
Meanwhile, the Central Bank of Sri Lanka has urged India and China to agree a write-down of their loans as soon as possible in an effort to “help us to start repaying their obligations”.
Sri Lanka, which is currently amidst the worst-ever economic crisis since its independence in 1948, defaulted on its debt repayments and negotiated a $2.9 billion bailout.
But the International Monetary Fund (IMF) will not release the funds until India and China first agree to reduce Sri Lanka’s billions of dollars of debt.
China’s lending to Sri Lanka stands at around $7 billion while India is owed around $1 billion.
The country suffered with severe shortages of food, fuel, medicines and cooking gas forcing people stay in days’ longs queues.
As an immediate measure, India, the closest neighbour, assisted Sri Lanka with nearly $4 billion in the first six months from January 2022.
