China: Kristalina Georgieva, the head of the International Monetary Fund, has urged China to expedite the debt restructuring for Sri Lanka. Ms. Georgieva stated that Sri Lanka’s debt treatments must be finalised and expedited in order to allow for IMF payments in a statement issued following the seventh 16 (one plus six) roundtable in China. Along with Japan, the Asian Development Bank, and India, China is one of the biggest lenders to Sri Lanka.
The IMF and World Bank will also be the subject of bilateral consultations, China has notified Sri Lanka. According to a recent assessment, as of the end of 2021, China controlled 19.6% of Sri Lanka’s debt. The practicality of some of China’s infrastructure loans, including as those for the Lotus Tower, the Hambantota Port, and an airport that has mostly gone underused, have also been called into question.
Due to the global economic crisis, Sri Lanka has earlier this year stopped payments on its international debt. There were severe shortages of petrol, food, and medications as a result of the island country’s declining foreign exchange reserves.