Sri Lankan Minister says government to commence talks with Bank of China for a three year loan
State Minister of Finance in Sri Lanka, Eran Wickramaratne has reportedly said that the country’s Cabinet of Ministers has agreed to commence talks with Bank of China for a three year loan.
Bank of China had offered to give US$ 300 million at 2.6 percent above the London Interbank Offered Rate to Sri Lanka for three years, the local media recently reported.
The loan could be upsized to about US$ 1 billion.
China Development Bank had earlier given another loan for eight years at a below market rate to bailout Sri Lanka.
According to reports, Sri Lanka has a soft-pegged exchange rate, where the country’s Central Bank intervenes in forex markets to target an exchange rate under multiple convertibility undertakings.
OSL take:
The recent announcements by the International Monetary Fund (IMF) of interest in re-commencing discussions on the stalled fund facility to Sri Lanka and funds offered by the Asian Development Bank (ADB) to Sri Lanka’s development agenda are indicative of the strengthening of the country’s economy while carrying on with its development programme. The latest loan with the Bank of China would also give a further boost to the country’s economy. Therefore, foreign businesses/investors could explore investment opportunities in Sri Lanka with confidence.
| Article Code : | VBS/AT/22012019/Z_3 |