Responding to Sri Lanka’s request to change China’s stance on debt relief, a spokesperson of the Chinese Embassy said that the ball is in Sri Lanka’s court, not China’s.
They further said that China had communicated to the Ministry of Finance of Sri Lanka three months ago about its readiness to discuss how to resolve the debt issue with Chinese banks.
He said that China encouraged its banks to discuss it. The Chinese position was also communicated in the telephone conversation between the Chinese Premier Li Keqiang and the then Sri Lankan Prime Minister Mahinda Rajapaksa.
“We have sent proposals to the finance ministry. But, there was no response from them. He also stressed that Sri Lanka should first complete the agreement with the International Monetary Fund (IMF). The ball is in Sri Lanka’s court,” the spokesman said.
The IMF estimates Sri Lanka’s total bilateral debt at $6.2 billion at the end of 2020.
Japan and China hold the largest shares. This year, India has provided around $4 billion to boost Sri Lanka’s economy, mainly through credit channels and exchanges. Sri Lanka also has an international sovereign bond debt of 14 billion dollars.