Africa-Press – Zambia. Sri Lanka has gotten its “debt redemption” from China, when is Zambia getting its “debt resurrection” from China? China has agreed to help Sri Lanka restructure its debt repayment obligations and enable it to access International Monetary Fund “bailout” finance.
Under the agreement, Sri Lanka will not have to repay the principal and interest during the period. China will not demand immediate repayment of debt from Sri Lanka for 2022 and 2023 and will expedite negotiations on medium- and long-term debt treatment.
This decision was made to help relieve the short-term debt repayment pressure on Sri Lanka and is part of China’s efforts to contribute to the debt sustainability of the country.
Sri Lanka is currently facing its worst economic crisis in more than seven decades, and the shortage of dollars has disrupted the imports of essential goods. Last year, the situation worsened when protesters ousted a president.
As of the end of 2020, Sri Lanka owed China’s EXIM bank US$2.83 billion, which is 3.5 per cent of its external debt. As of the end of 2022 it owed Chinese lenders US$7.4 billion, which is almost a fifth of its public external debt.
This development sets the stage for final approval of the IMF’s US$2.9 billion, four-year “bailout” for Sri Lanka on March 20. China will call on commercial creditors to provide debt treatment in an equally comparable manner and encourage multilateral creditors to make contributions to help Sri Lanka better respond to the crisis and emerge from it.
For More News And Analysis About Zambia Follow Africa-Press
