brand logo

Govt. tours Middle East to remedy debt distress

12 Apr 2021

  • Debt payments come in May and June

  • Oman tour follows Premier’s recent tour to Bangladesh

  As a part of its measures to find multiple sources of funding to strengthen the country’s foreign reserves in the face of the upcoming external debt payments that need to be made, Sri Lanka’s high-level officials including State Minister of Money, Capital Market, and Public Enterprise Reforms Ajith Nivard Cabraal had late last week engaged in a discussion with Oman’s top officials.  Sultanate of Oman Deputy Prime Minister for International Relations and Co-operation Affairs Sayyid Asaad bin Tariq had discussions with the Sri Lankan counterpart.  Cabraal in a recent tweet noted that they had a “very useful” discussion with Central Bank of Oman Executive President Tahir Al Amri and also discussed future collaborations between the Sri Lankan banks and Bank of Muscat Chief Executive Officer (CEO) Sheikh Waleed Khamis. He added that the Sri Lankan delegation was the first diplomatic delegation to undertake an official visit to Oman after the onset of the pandemic.  However, when The Morning Business inquired on the outcome of the trip to the Middle East, State Minister Nivard Cabraal stated it was a “Prime Minister to Prime Minister discussion”. Central Bank of Sri Lanka Governor Prof. W.D. Lakshman, during a recent press conference, stated that Sri Lanka is moving in the direction of finding multiple sources of funding and currently engaged on an overseas trip with high-level officials of the monetary institution of the Middle East to discuss support. The Central Bank claimed Sri Lanka’s gross official reserves amounted to $ 4.1 billion (excluding the swap facility with China), at the end of March. Accordingly, the upcoming debt repayments in May and July are expected to be about $ 720 million and $ 1 billion, respectively. Last Month, Premier Mahinda Rajapaksa visited Bangladesh and met with the Governor of Bangladesh Bank and discussed how the Central Banks of both the countries could work together on swaps.   In Addition, Treasury Secretary S.R. Attygalle told us that, out of the $ 700 million loan Sri Lanka requested from the China Development Bank (CDB) last year, $ 500 million is expected to be provided to the country as a dollar credit this month and the remaining 200 million is renminbi denominated credit and would be issued to the country during Sri Lankan President Gotabaya Rajapaksa’s upcoming visit to China. Last month, the People’s Bank of China approved a swap facility of $ 1.5 billion to the Central Bank of Sri Lanka. This agreement, signed between the Central Bank of Sri Lanka and the People’s Bank of China, is valid for three years and the deal was made in a period when Sri Lanka was struggling with the Covid-19 pandemic.


More News..