Sri Lanka urges China to restructure loan repayment

By Susitha Fernando

Colombo, Jan 9 (IANS) Amidst the ongoing financial and forex crisis, Sri Lankan President Gotabaya Rajapaksa has requested the visiting Chinese Foreign Minister Wang Yi for possible restructure of the debt repayment.

"It would be a great relief if it could be focused on restructuring the debt repayments as a solution to the economic crisis that has arisen due to the Covid-19 pandemic," President Rajapaksa said.

President Rajapaksa met China's Foreign Minister and State Councilor Yi who was visiting Sri Lanka marking the 65 years of diplomatic relations between the two countries. Sri Lanka is the final destination of Chinese Minister who visited five countries in the Belt and Road Initiative (BRI) from Africa to Asia Eritrea, Kenya and Comoros in Africa and the Maldives in Asia.

In the back drop of financial crisis faced by the Indian Ocean island nation, President Rajajapaksa also said, "if a concessional trade credit scheme could be obtained for imports from China, it would enable industries to run smoothly".
During the meeting, President Rajapaksa also has requested Minister Yi to assist in attracting Chinese tourists to Sri Lanka by allowing visit using the bio-bubble program, President's Office said in a statement.

During the meeting Sri Lankan leader thanked the "Chinese government for the material and financial assistance given to battle the Covid-19 pandemic and for its continued support in providing Sri Lanka with Sinopharm vaccines for the successful implementation of the vaccination program", President's Office stated.

In response, Chinese Foreign Minister has stated that "China would always support the island nation as a close friend".

Meanwhile Prime Minister Mahinda Rajapaksa who met Wang Yi at the Temple Trees has thanked Chinese government for its financial support in the backdrop of Covid-19 pandemic.
"As you know, similar to many other countries, Sri Lanka's economy was also greatly impacted by the pandemic. We appreciate China's assistance towards our economic revival and financial stability," said Premier Mahinda Rajapaksa.

"There is still a long way to go in establishing normalcy, but we're confident that with support from friendly countries like China, we will be able to overcome these challenges soon. I look forward to continue working closely with you and the Government of China in addressing common challenges," PM Rajapaksa said.

Foreign Minister Yi has assured to assist Sri Lanka and has said "China will continue to do its best to provide all the necessary help and support [to Sri Lanka]," Prime Minister's Office stated.

Chinese Foreign Minister's visit comes amidst strained relationship due to shipment of 20,000 metric tonnes of organic fertilizer from China which was rejected by Sri Lanka after it was found to be infected with harmful bacteria.

In last September, the Hippo Spirit ship carrying organic fertilizer left for Colombo from China's Qingdao Port. Initially Sri Lankan court ordered state-run People's Bank not to pay for the shipment and in response Chinese embassy blacklisted the bank. However, bowing to the pressure of Beijing on Saturday (January 8) the bank paid the fertilizer company Qingdao Seawin Biotech Group $6.87 million while settling legal dispute.