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China’s Debt Relief Offer For Sri Lanka May Not Be Enough to Satisfy IMF, Say Insiders

by Eric Olander
File image of the exterior of the IMF headquarter building in Washington, D.C. MANDEL NGAN / AFP

Sri Lanka’s desperately-needed financial lifeline from the International Monetary Fund may be in jeopardy due to an insufficient debt restructuring offer from China, Colombo’s largest bilateral creditor.

The IMF is requiring that Sri Lanka first receive assurances from its largest bilateral creditors, namely China, India and Japan, to restructure its outstanding debt. While India and Japan both did so unconditionally, China last week came forward with a somewhat reduced offer that sources tell Sri Lanka’s Daily Mirror newspaper will not be enough to satisfy the IMF.

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