ECONOMYNEXT – Sri Lanka has repaid another 100 million US dollars in the second installment of the 200 million-dollar loan given by Bangladesh in a currency swap, the Dhaka Tribune reported citing a Bangladesh Bank spokesperson.
Colombo paid 50 million dollars in August in the first installment of the loan repayment.
Bangladesh lent 200 million from its foreign exchange reserves to Sri Lanka during its economic crisis, the Dhaka Tribune reported on Friday, September 1, afternoon.
The remaining 50 million is due to be repaid within the current year, Bangladesh Bank Executive Director and Spokesperson Mesbaul Haque was quoted as saying.
Bangladesh has extended the debt repayment time to give Sri Lanka time to revive its economy, the newspaper reported.
On August 22, Bangladesh’s The Daily Star quoted Haque as saying: “We are hopeful that the entire amount will be cleared by September.”
Initially, Sri Lanka was supposed to repay the amount within three months.
Bangladesh lent the money to Sri Lanka in three installments within 2021. On August 19, 2021 the first tranche of 50 million dollars was sent, following which the second installment of 100 million dollars was issued, and a final 50 million dollars in September.
Sri Lanka was to repay the loan by the end of 2021, with an interest rate of LIBOR + 2 percent.
During the 2022 currency crisis, Sri Lanka’s worst in decades, the repayment was extended multiple times. The final extension to September this year was made in May 2022, with the interest rate fixed at LIBOR + 2.5 percent. (Colombo/Sep01/2023)