China continues extending its support to Sri Lanka as it assures to restructure the debt of the island nation. Sri Lanka’s President Ranil Wickremesinghe stated in Parliament that they have received support from China as it was seeking help from the world’s largest sovereign creditor.
China’s Export-Import Bank in its letter on March 6 said, “firm support to Sri Lanka through a debt treatment”. The country is witnessing the worst economic crisis in seven decades.
Sri Lanka is negotiating a $2.9 billion loan with the international monetary fund to bring some stability to its severe economic crisis. IMF had placed a condition on the nation that it must restructure its debts to avail of the IMF loan. The latest move by China eases the hurdle of debt restructuring with the IMF.
The country witnessed nationwide protests and ousted its elected officials last year over the despicable conditions of the economy. Years of poor government policies, mismanagement of funds, and finally the impact of Covid-19 were major reasons for the economic crises.
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