IMF reserves its comments on granting RFI to Sri Lanka

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Sri Lanka is still not been able obtain assurances from the International Monetary Fund(IMF) for a Rapid Finance Instrument (RFI) owing to lack of any firm agreement on the debt restructuring among key bilateral creditors specially China, a senior official closely connected to SL foreign debt servicing revealed.

China must be treated just like any other creditor once talks begin to restructure Sri Lanka’s debt, India’s Finance Minister Nirmala Sitharaman said in Washington recently adding that she told the IMF and World Bank about it.

China is yet to finalise a US $2.5 billion credit line or enter into an agreement on restructuring of its overall debt, the official added.

About 22 per cent of Sri Lanka’s debt is owed to bilateral creditors — China and Japan (10 per cent each) as well as India (2 per cent).

The main reason for this attitude of China was their reluctance to favour Sri Lanka as it will set a bad precedent for other nations who have borrowed from them.

Foreign Minister Prof. G.L Peiris recently requested Chinese assistance for debt restructuring at meeting with the Chinese Ambassador in Colombo Qi Zhenhong but the latter has not responded to it, informed sources said. (Bandula)

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