Sri Lanka is caught in a spiralling crisis of rising foreign debt, runaway food inflation, massive shortages of fuel and daily power cuts…writes Rahul Kumar
Sri Lankan ambassador to China, Palitha Kohona says that China is ready to support the island nation with almost $2.5 billion in finances. Sri Lankan President Gotabaya Rajapaksa had written to his Chinese counterpart Xi Jinping recently to bail out the country from its serious financial downturn.
Sri Lankan news website Ada Derana quoted Kohona as saying that authorities in China had given assurances last week that the country was making arrangements for loans and credit lines. The Indian Ocean nation seeks to borrow $1 billion to repay the upcoming July loan to China and a $1.5 billion line of credit to purchase Chinese goods to support its apparel export industry.
Under the Rajapaksa family, the two nations enjoy strong diplomatic and economic relations. China has liberally funded mega projects–the Hambantota port, the Colombo Port City and the Mattala Rajapaksa International Airport (MRIA), also known as the world’s emptiest airport. Critics say that these giant infrastructure projects have made China rich but not brought anything to Sri Lanka.
Justifying Chinese help, Kohona said: “Given the current circumstances, there aren’t that many countries that can step out to the pitch and do something. China is one of those countries that can do something very quickly”.
Sri Lanka is caught in a spiralling crisis of rising foreign debt, runaway food inflation, massive shortages of fuel and daily power cuts. People are camping on the streets asking for President Rajapaksa to resign and his family members to stay away from running the country.
The Sri Lankan ambassador’s statements come on the heels of Prime Minister Mahinda Rajapaksa’s television address on Monday night, where he pleaded with the demonstrators to go back home. “Each minute of the day, the President and the Cabinet are discussing ways to address this situation. Though we cannot do it in a day or two, we are working to solve this problem as soon as possible,” the Prime Minister said in his address.
Sri Lankan newspaper Daily FT reported that Mahinda Rajapaksa told protestors that every moment they stay on the streets, they are disrupting the flow of dollars into the country. He said: “I believe the people of this country are aware of the economic problems the country has had to face after the Covid pandemic. Although we were able to save people’s lives, we can feel the country has fallen into an abyss. There is no need for me to repeat how, after the lockdown of the country, we lost sources of foreign exchange and how the foreign reserves dried up”.
The President and Prime Minister have, however, not accepted the demands of the opposition and from the public that they take responsibility for the socio-economic crisis and step down. The Rajapaksa’s political allies in the parliament too are asking the Rajapaksa family to resign amid rising public anger and one-point agenda–that the president resigns and hands over the government to a joint political administration.
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