BEIJING: After weeks of trying to respond to calls for help from people in distress Sri LankaChina, whose island nation has been accused of debt diplomacy due to large loans and investments, has said it would provide “emergency humanitarian aid” to Colombo, but remained silent on its plea for debt rescheduling.
Chinese government has decided to impose emergency humanitarian aid China International Development Cooperation Agency spokesman Xu Wei said that Sri Lanka to help the country to deal with the current difficulties.
China has seen Sri Lanka’s economic difficulties, Xu said, adding that as Sri Lanka’s traditionally friendly neighbour, the Chinese government has decided to provide emergency humanitarian assistance to help the country tide over the current difficulties, official Xinhua News The agency quoted Xu as saying on Tuesday.
On Wednesday, Chinese Foreign Ministry spokesman Wang Wenbin reiterated this at a media briefing here, adding that “the Chinese side has announced that it will provide emergency humanitarian assistance to Sri Lanka.”
“We will continue to offer support and assistance to Sri Lanka to the best of our ability to help Sri Lanka reinvent its economy and improve people’s livelihoods,” he said.
Sri Lanka has been grappling with unprecedented economic turmoil since independence from Britain in 1948. The crisis is due to a lack of foreign exchange, meaning the country cannot pay for imports of staple foods and fuels, leading to an acute economic crisis. Scarcity and very high prices.
The island nation is witnessing massive protests against the government’s handling of the debt-ridden economy – the worst economic crisis ever in the country’s history.
On Monday, Sri Lanka sought a Rapid Financing Instrument (RFI) from the IMF to bring the country out of the quagmire of economic crisis.
Troubled by a huge foreign exchange crisis, Sri Lanka on April 12 announced a pre-emptive default of all its foreign debt totaling $51 billion as a “last resort” and emergency measure.
While China balked, India has provided nearly $2.5 billion in aid to Sri Lanka over the past three months, including loan facilities for fuel and food, and reportedly $2 billion to aid the island nation in crisis. assistance has been considered.
However, both Xu and Wang did not provide any details about China’s humanitarian aid.
Earlier reports said that China had offered rice shipments to Sri Lanka, citing the Rubber-Rice Agreement signed in 1952, under which China supplied rice and imported rubber from Colombo.
So far, Beijing has remained silent on Chinese Ambassador to Colombo Qi Zhenhong’s announcement last month that China is considering a $2.5 billion line of credit to Sri Lanka.
Also, China has so far deferred questions on the Sri Lankan President. Gotabaya RajapakseRequest made to Chinese Foreign Minister wang yi During his visit to the restructuring of Colombo’s loan repayments to give relief to his government in December last year.
It is estimated that Sri Lanka owes China a debt of about $ 1.5 to 2 billion this year. China’s total debt and investment in Sri Lanka in the past few years is estimated to exceed $8 billion.
Maintaining silence on Sri Lanka’s loan moratorium, China has quietly accepted Pakistan’s request for a $4.5 billion loan moratorium last month. Former Pakistan Foreign Minister Shah Mehmood Qureshi had announced the evasion during his visit to China on 30 March. Diplomatic sources here say that China informed Sri Lanka of its reservations on deferment of debt, saying that there is no such provision in their financial system; Instead one might perhaps consider providing a loan to repay the loan with tighter terms.
Chinese debt to Sri Lanka reportedly accounts for around 10 per cent of its external debt, which includes huge infrastructure projects such as the Hambantota port, which China received as a loan swap for a 99-year lease, as part of debt diplomacy. With accusations internationally criticized, smaller countries implicated. With huge loans and projects under its Belt and Road Initiative (BRI).
China is reportedly worried because apart from Sri Lanka, other BRI signatories Pakistan and Nepal in South Asia also faced financial crunch coupled with massive foreign exchange woes in search of international bailouts.
China’s debt accounts for 65 percent of bilateral debt, which is worth hundreds of billions of dollars in Africa, Eastern Europe, Latin America and Asia, according to a study by EdData, a US data research laboratory.
Commenting on China’s dilemma over granting a bailout, Ganesan Vignaraja, a senior fellow at the National University of Singapore, said Beijing is likely to be reluctant to step in.
“China doesn’t want to lose money,” he said. “If China gives Sri Lanka a special bailout, other countries in the Belt and Road Initiative that are in similar difficulties will ask for similar assistance,” he recently told the Hong Kong-based South China Morning Post.
But Colombo’s decision to suspend payments on its external debts will put pressure on Beijing to part with international aid to Sri Lanka, Vignaraja said. Vignaraja said helping Sri Lanka would be one way to address allegations of debt-trap. “Otherwise the label will stick,” he said.
“If China behaves like a bank, it will make the credit problem worse than the debt trap and it will actually become a Chinese problem,” Vignaraza said. He also said that China should look at the “debt position” of a country when it grants loans. “It should not give more money at commercial interest rates so that countries run the risk of falling into debt traps like the one Sri Lanka has now fallen into. So China has a moral and legal and developmental obligation.
Chinese government has decided to impose emergency humanitarian aid China International Development Cooperation Agency spokesman Xu Wei said that Sri Lanka to help the country to deal with the current difficulties.
China has seen Sri Lanka’s economic difficulties, Xu said, adding that as Sri Lanka’s traditionally friendly neighbour, the Chinese government has decided to provide emergency humanitarian assistance to help the country tide over the current difficulties, official Xinhua News The agency quoted Xu as saying on Tuesday.
On Wednesday, Chinese Foreign Ministry spokesman Wang Wenbin reiterated this at a media briefing here, adding that “the Chinese side has announced that it will provide emergency humanitarian assistance to Sri Lanka.”
“We will continue to offer support and assistance to Sri Lanka to the best of our ability to help Sri Lanka reinvent its economy and improve people’s livelihoods,” he said.
Sri Lanka has been grappling with unprecedented economic turmoil since independence from Britain in 1948. The crisis is due to a lack of foreign exchange, meaning the country cannot pay for imports of staple foods and fuels, leading to an acute economic crisis. Scarcity and very high prices.
The island nation is witnessing massive protests against the government’s handling of the debt-ridden economy – the worst economic crisis ever in the country’s history.
On Monday, Sri Lanka sought a Rapid Financing Instrument (RFI) from the IMF to bring the country out of the quagmire of economic crisis.
Troubled by a huge foreign exchange crisis, Sri Lanka on April 12 announced a pre-emptive default of all its foreign debt totaling $51 billion as a “last resort” and emergency measure.
While China balked, India has provided nearly $2.5 billion in aid to Sri Lanka over the past three months, including loan facilities for fuel and food, and reportedly $2 billion to aid the island nation in crisis. assistance has been considered.
However, both Xu and Wang did not provide any details about China’s humanitarian aid.
Earlier reports said that China had offered rice shipments to Sri Lanka, citing the Rubber-Rice Agreement signed in 1952, under which China supplied rice and imported rubber from Colombo.
So far, Beijing has remained silent on Chinese Ambassador to Colombo Qi Zhenhong’s announcement last month that China is considering a $2.5 billion line of credit to Sri Lanka.
Also, China has so far deferred questions on the Sri Lankan President. Gotabaya RajapakseRequest made to Chinese Foreign Minister wang yi During his visit to the restructuring of Colombo’s loan repayments to give relief to his government in December last year.
It is estimated that Sri Lanka owes China a debt of about $ 1.5 to 2 billion this year. China’s total debt and investment in Sri Lanka in the past few years is estimated to exceed $8 billion.
Maintaining silence on Sri Lanka’s loan moratorium, China has quietly accepted Pakistan’s request for a $4.5 billion loan moratorium last month. Former Pakistan Foreign Minister Shah Mehmood Qureshi had announced the evasion during his visit to China on 30 March. Diplomatic sources here say that China informed Sri Lanka of its reservations on deferment of debt, saying that there is no such provision in their financial system; Instead one might perhaps consider providing a loan to repay the loan with tighter terms.
Chinese debt to Sri Lanka reportedly accounts for around 10 per cent of its external debt, which includes huge infrastructure projects such as the Hambantota port, which China received as a loan swap for a 99-year lease, as part of debt diplomacy. With accusations internationally criticized, smaller countries implicated. With huge loans and projects under its Belt and Road Initiative (BRI).
China is reportedly worried because apart from Sri Lanka, other BRI signatories Pakistan and Nepal in South Asia also faced financial crunch coupled with massive foreign exchange woes in search of international bailouts.
China’s debt accounts for 65 percent of bilateral debt, which is worth hundreds of billions of dollars in Africa, Eastern Europe, Latin America and Asia, according to a study by EdData, a US data research laboratory.
Commenting on China’s dilemma over granting a bailout, Ganesan Vignaraja, a senior fellow at the National University of Singapore, said Beijing is likely to be reluctant to step in.
“China doesn’t want to lose money,” he said. “If China gives Sri Lanka a special bailout, other countries in the Belt and Road Initiative that are in similar difficulties will ask for similar assistance,” he recently told the Hong Kong-based South China Morning Post.
But Colombo’s decision to suspend payments on its external debts will put pressure on Beijing to part with international aid to Sri Lanka, Vignaraja said. Vignaraja said helping Sri Lanka would be one way to address allegations of debt-trap. “Otherwise the label will stick,” he said.
“If China behaves like a bank, it will make the credit problem worse than the debt trap and it will actually become a Chinese problem,” Vignaraza said. He also said that China should look at the “debt position” of a country when it grants loans. “It should not give more money at commercial interest rates so that countries run the risk of falling into debt traps like the one Sri Lanka has now fallen into. So China has a moral and legal and developmental obligation.