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Sri Lanka could finalize billion dollar plus China loan within weeks

ECONOMYEXT – Sri Lanka is making good progress with loans of more than a billion US dollars loan from China Development Bank, which may be finalized within weeks, Central Bank Deputy Governor Nandalal Weerasinghe said.

Discussions centered around a loan of 1 to 2 billion US dollars, but could be around 1.3 billion US dollars, he said.

The loan could be finalized within weeks, he said and could amount to around 1.3 billion US dollars.

The loan would be within the borrowing limits approved in a vote on account up to April, Weerasinghe said.

Sri Lanka’s budget deficit is expected to rise to 7.5-7.9 percent of the gross domestic product in 2020, after value-added taxes were slashed.

A cash injection from China would help keep domestic interest rates in check.

Data showed that the government borrowing from the banking system was 120 billion rupees in January. (Colombo/Mar05/2020)

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