February 3, 2023
2 mins read

China-US spar over Lankan debt crisis

Chinese spokesperson Ning was responding to US Under Secretary of State for Political Affairs Victoria Nuland’s remarks…reports Susitha Fernando

In a counter-attack to a recent comment made by a US government official on Sri Lankas debt restructuring process to obtain the $2.9 billion International Monetary Fund (IMF) bailout, China said that Washington should show sincerity by helping the crisis-hit island nation

“Rather than jabbing fingers at China’s close cooperation with Sri Lanka, the US might as well show some sincerity and actually do something to help Sri Lanka weather through the current difficulties,” spokesperson of the Chinese Foreign Ministry Mao Ning said at a recent press conference.

Ning was responding to US Under Secretary of State for Political Affairs Victoria Nuland’s remarks who said that what China had offered so far to Sri Lanka was not enough.

Sri Lankan,india flag.

Nuland was on an official visit to Colombo this week to mark the 75th anniversary of US-Sri Lanka relations.

“What was said by the US side does not reflect the truth. The Export-Import Bank of China has already provided Sri Lanka with the letter to express support for its debt sustainability. Sri Lanka has responded positively and thanked China for that.

“We support Chinese financial institutions in having consultations with Sri Lanka to seek a proper settlement to its China-related debt issue. We also stand ready to work with relevant countries and international financial institutions to play a positive role in easing Sri Lanka’s debt burden.

“As a friendly neighbour and true friend, China has been closely following the difficulties and challenges facing Sri Lanka and providing assistance for its economic and social development to the best of our capabilities.

“As to Sri Lanka’s debt to the Chinese side, China supports relevant financial institutions in having consultations with Sri Lanka to seek a proper settlement.

“China stands ready to work with relevant countries and international financial institutions and continue to play a positive role in helping Sri Lanka navigate the situation, easing its debt burden and helping it achieve sustainable development,” the spokesperson added.

Sri Lanka, which is undergoing its worse economical crisis since gaining independence in 1948, is desperately awaiting the $2.9 billion conditional extended fund facility from the IMF but it requires the assurances from the major bilateral creditors — Japan, China and India.

While India has given its assurance to the IMF, China has offered a two-year debt moratorium to Sri Lanka.

But the IMF has reportedly has stated that it was not sufficient for Sri Lanka to secure the bailout package.

ALSO READ: ‘What China offered is not enough’: US on Lanka’s debt crisis

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