• Sri Lanka’s foreign debt is made up of multiple components
• China mostly extends preferential loans to Sri Lanka with low interest rates and long-term maturity, which has helped improve Sri Lanka’s infrastructure and livelihood

 In response to USAID administrator Samantha Power, Chinese Foreign Ministry Spokesperson Zhao Lijian said Sri Lanka’s foreign debt is made up of multiple components and the share of China-related debts is far lower than that of the international capital market and multilateral development banks.   

He took this question from Global Times during his regular press conference in Beijing, the Chinese embassy in Colombo shared it with the local media. 

The cooperation has contributed to Sri Lanka’s economy and brought tangible benefits to the Sri Lankan people. Sri Lanka’s foreign debt is made up of multiple components. The share of China-related debts is far lower than that of the international capital market and multilateral development banks. Besides, China mostly extends to Sri Lanka preferential loans with low interest rates and long-term maturity, which have helped improve Sri Lanka’s infrastructure and livelihood. Shortly after Sri Lanka’s announcement to suspend international debt payments, Chinese financial institutions reached out to the Sri Lankan side and showed full readiness to find a proper way to handle the matured debts concerning China and to help Sri Lanka overcome difficulties.  

I want to stress that the global economic and financial markets have suffered enormously as a result of the US’s recent sudden interest rate hike and balance sheet reduction, which have rapidly siphoned off dollars on top of the US’s long-running quantitative easing policy and irresponsible massive stimulus.