China offers to help revive Sri Lanka’s battered economy

Colombo, Nov 8 (EFE).- China has reassured its commitment to help Sri Lanka revive its economy, which is going through its worst crisis since independence, the island nation’s Minister of Finance said on Tuesday.

Shehan Semasinghe said he was conveyed Beijing’s readiness to aid the crisis-hit nation during his meeting with Chinese Ambassador Qi Zhenhong the previous day.

“There were news articles that said China was not ready to help Sri Lanka, but this is wrong. China will help us,” the finance minister told EFE.

Following the meeting, the Chinese Embassy in Sri Lanka tweeted that Beijing “reiterated” its “continued and concrete support” to Sri Lanka to overcome its challenges.

The island nation is undergoing its worst economic crisis in over seven decades which led to weeks of mass protests earlier this year and caused then-President Gotabaya Rajapaksa to step down and flee the country.

The country has been suffering from a shortage of foreign reserves as a result of the pandemic, along with several certain faulty government policies, among other things, resulting in spiraling inflation and an acute shortage of essentials like fuel and medicine.

Under a new government led by new President Ranil Wickremesinghe, Colombo has begun discussions with its creditors after reaching a Staff-Level Agreement with the International Monetary Fund (IMF) on a four-year $2.9 billion program, supported by its Extended Fund Facility in September this year.

The agreement is now pending executive board approval of the financial body.

Last week, the finance ministry and the central bank held a virtual meeting with the country’s official creditors in which it expressed its commitment towards advancing engagements with all creditors in an equitable and transparent way.

“Sri Lanka is at a critical stage, and we are seeking IMF program approval as soon as possible so that we can restore macroeconomic stability,” Semasinghe said at the meeting.

He added that the IMF program and “our ambitious economic reforms” would help restore public debt sustainability, protect the most vulnerable and restart the country’s growth engine, while ensuring that citizens have access to “critical public services.”

The finance head, during his interaction with EFE, revealed that none of the creditors have refused to help Sri Lanka.

“We will follow an equitable, comparable and a transparent policy. So, every official bilateral creditor is equally important,” he said. EFE

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