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Sri Lanka plans talks with China to restructure debts

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Sri Lankan Prime Minister Ranil Wickremesinghe said on Tuesday that the country is looking forward to talks with China about debt restructuring.

Wickremesinghe made the remarks following a meeting with China’s Deputy Ambassador Hu Wei in Colombo.

President Gotabaya Rajapasa urged Beijing in January to restructure debt repayments as the country faced its worst economic crisis in decades. When Rajapaksa met with Chinese Foreign Minister Wang Yi, he made this request.

Over the last decade, China has loaned over $5 billion for projects such as highways, ports, and airports, but political analysts claim that the majority of the projects were white elephants with no return to the island nation.

China accounts for 10% of total loans in Sri Lanka and is the third largest lender after Japan and the Asian Development Bank.

With no dollars to import food, fuel, medicine, or cooking gas, Sri Lanka suspended its $7 billion debt payment for 2022 in April.

Wickremesinghe also reiterated Sri Lanka’s commitment to the “One China Policy” during the discussion.

“The Chinese Deputy Ambassador inquired about Sri Lanka’s food security programmes and re-assured the Prime Minister that China would be donating rice to Sri Lanka to help ease the food crisis,” the PM office stated.

Amid the impending food crisis in Sri Lanka, China has offered a grant of 10,000 metric tonnes of rice worth approximately $74 million, with two of six shipments expected to arrive in Colombo between June 25 and 30.

Last week, Wickremesinghe announced plans to import 50,000 metric tonnes of rice through an Indian credit line in order to alleviate Sri Lanka’s food crisis. India has offered more than $3.5 billion in financial assistance to Sri Lanka in order for it to obtain food, fuel, medicine, and other necessities.


About the author

Brendan Taylor

Brendan Taylor was a TV news producer for 5 and a half years. He is an experienced writer. Brendan covers Breaking News at Insider Paper.

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