Sri Lankan Ambassador to China Dr. Palith Kohona said that they are to negotiate for an emergency US$ 4 billion package to help it emerge from an economic meltdown.
This includes a US$ 1.5 billion credit line to pay for Chinese imports which includes raw material needed by his country’s lucrative garment industry and for other industries. Sri Lanka also hopes to persuade China to activate a $1.5 billion bilateral currency swap.
In addition Sri Lanka also hopes China can help it buy fuel, fertilizer and other urgently needed supplies, news wire services said. Kohona said discussions on financial aid with China are still underway but no date for the next meeting has been set.
Since China has similar requests from other countries this process is slowing down. “Maybe if it was only Sri Lanka, then the decision-making would’ve been much easier.” China pledged US$74.09 million of emergency support for Sri Lanka in April and May but we are looking for more.
In addition, most importantly Sri Lanka is looking for Chinese help with trade, investment and tourism to help the country in the long term.
Chinese companies have made several investments in the China-backed port projects in Colombo and Hambantota. “However more major Chinese investment plans are stalled because of the COVID-19 pandemic,” Kohona said.
“We also want China to ask their companies to buy more Sri Lankan black tea, sapphire, spices and garments and to make Chinese import rules more transparent and easier to navigate.”
He said that Sri Lankan President Ranil Wickremesinghe is no stranger to China as he had visited Beijing in 2016 as prime minister and met Chinese President Xi Jinping. Dr. Kohona said they are now planning for a visit of President Wickremesinghe to China soon to discuss cooperation on matters including trade, investment and tourism.
Kohona said he expects no deep change in the new government’s policy towards China.