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Friday January 21st, 2022
Banking

Sri Lanka state bank says acting on court order after China embassy ‘blacklisting’

ECONOMYNEXT – Sri Lanka’s state-run People’s Bank said it was simply carrying out a court order in not paying a China based supplier which had shipped fertilizer which was found to be contaminated with erwinia bacteria on a sample test.

Embassy of People’s Republic of China in Colombo said its Commercial Counselor has “blacklisted” the bank for not making payment on the letter of credit to Qingdao Seawin Biotech.

However the the People’s Bank said it cannot make the payment until the court order is lifted.

Related Sri Lanka blocks payment to China Qingdao Seawin Biotech over fertilizer with bugs

News on blacklisting of People’s Bank by Embassy of People’s Republic of China in Sri Lanka

With regard to the news item being circulated in media on the captioned matter, People’s Bank wishes to clarify the following;

• People’s Bank has come to notice that the Economic and Commercial Counselor of Embassy of People’s Republic of China in Sri Lanka has blacklisted the People’s Bank for not effecting the payments for in lieu of a Letter of Credit issued by the bank

• People’s Bank has already communicated to the relevant authorities at the Chinese Embassy that the bank is bound by an enjoining order issued by the Western Province Commercial High Courts of Sri Lanka with regard to the trade transaction in question, which precludes the bank from processing of the payment

• The temporary delay in processing the said payment pertaining to the LC is solely due to the bank’s obligation to be bound by the legal directions of the country as a responsible corporate citizen

• Once the legal barriers in effect are removed, the LC payment will be effected promptly as per the usual trade practices

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