COLOMBO: Further to a Foreign Currency Term Financing Facility (FTFF)
requested by the Sri Lankan Government, a $500 Million Financing Facility was signed in Beijing between the China Development Bank (CDB) and Sri Lankan Finance Ministry, on Monday, April 12, the Embassy of China announced here
on Monday.
The facility is with a maturity period of ten years (including a grace period of three years), which is the longest tenure of term financing facilities for Sri Lanka.
Meanwhile, Ambassador Dr. Palitha Kohona, also confirmed via media release on entering in to a loan agreement (USD 500 million) with the China Development Bank on 12th April 2021.
The full text of the media release issued by the Embassy of the Democratic socialist Republic of Sri Lanka in the People’s Republic of China is as follows.
Sri Lanka signs $500 Million Loan Agreement with China
Ambassador Dr. Palitha Kohona, on behalf of the government of
Sri Lanka, signed a $500 million loan agreement with the China Development Bank
on 12th April 2021.
This loan will infuse vitally required foreign exchange into the
Sri Lankan economy. These funds will help with Government efforts to facilitate rapid economic recovery following the setbacks caused by the Covid-19 pandemic.
After the signature ceremony, Dr Kohona stated that the timely
assistance from China in providing these funds will help fuel Sri lanka’s
recovery efforts and stimulate growth. Dr. Kohona further opined that this $500 million loan will encourage investor confidence in Sri Lanka and strengthen the
currency.
China, as a loyal friend and reflecting the depth of our
friendship, has been generously extending its helping hand to Sri Lanka when difficult challenges confronted us. Two weeks ago, China’s gift of 600,000
Covid-19 vaccines were airfreighted to Sri Lanka adding to our vaccine stock.
He welcomed further cooperation on trade, investment, tourism,
education, sports and other areas. “We expect more Chinese tourists to visit
Sri Lanka in the post Covid-19 period with the prospect of travel restrictions
being relaxed in the near future”.
Dr. Kohona send that we were in discussion with Chinese producers with a view to shooting a tourism-oriented movie in the near future. The Mission was also holding talks to improve access to Sri Lankan exports to the lucrative market while encouraging increased FDI flows to Sri Lanka. All these would assist our economy to recover in the shortest period. Dr. Kohona stated. This USD 500 million was a part of USD 1 billion, out of which USD 500 million was released last year. Previously, the Mission had worked closely with Chinese counterparts to secure these funds.
