The island nation is going through the worst-ever financial crisis since the country’s independence in 1948 and battling with the skyrocketing inflation and dollar crunch..writes Susitha Fernando
Visiting representatives from the World Bank (WB), Asian Development Bank (ADB), International Monetary Fund (IMF) and Asian Infrastructure Investment Bank (AIIB) have ruled that a coordinated assistance program supported by multilateral financial institutions is vital for Sri Lanka’s recovery from the current economic crisis.
On Tuesday, the group of representatives, which included WB Vice President Martin Raiser, ADB Vice President Shixin Chen, IMF’s Senior Mission Chief Peter Breuer and AIIB’s Urjit Patel, met President Ranil Wickremesinghe, other ministers and top financial officials in Colombo.
Wickremesinghe, who also holds the Finance portfolio, presented Sri Lanka’s development programme associated with the economic recovery and growth along with the vision for long-term development.
The meeting also saw the participation of Prime Minister Dinesh Gunawardene, Governor of the Central Bank of Sri Lanka Nandalal Weerasinghe, former GovernorIndrajith Coomaraswamy and many other senior officials from the government institutions and other institutions.
Going through the worst-ever financial crisis since the country’s independence in 1948 and battling with the skyrocketing inflation and dollar crunch, Sri Lanka decided to default its $51 billion foreign debt in May.
In September the island nation reached a staff-level agreement with the IMF to obtain a conditional $2.9 billion package. But the country has to obtain assurance from its diverse creditors including India, Japan and China.
India, which has provided over $3.8 billion financial assistance since January, the biggest ever by a single country, has urged the IMF to assist its southern neighbour, while Japan in September announced its support for the island nation to secure the IMF bailout.
China, the top lender since the end of civil war in 2009, is yet to announce its stance.
Last week, Shanakiyan Rasamanickam, an Opposition lawmaker representing the Tamil National Alliance, charged that China was stalling Sri Lanka’s IMF deal.
“If China is truly Sri Lanka’s friend, ask the Chinese to help with the debt restructuring and the IMF program,” he challenged.
Questioned by the media on Monday, China’s Foreign Ministry spokesperson Mao Ning said that Beijing would assist the countries and financial institutions to resolve Colombo’s crisis.
“China attaches high importance to Sri Lanka’s difficulties and challenges. We support the financial institutions in working out ways with Sri Lanka to properly solve the issue. We also hope relevant countries and international financial institutions will work with China and continue to play a constructive role in helping Sri Lanka overcome the current difficulties, ease its debt burden and realize sustainable development,” the spokesperson added.
