International Business: Sri Lanka in talks for $100 million funding from Beijing-backed bank – Gulf Digital News

International Business: Sri Lanka in talks for $100 million funding from Beijing-backed bank – Gulf Digital News

COLOMBO: The China-backed Asian Infrastructure Investment Bank is considering granting $100 million in emergency support to Sri Lanka, the country’s finance ministry said yesterday.

Sri Lanka has requested foreign-exchange liquidity support for state banks from the lender, it said in a statement.

Hit hard by the pandemic, rising oil prices and populist tax cuts by the government of President Gotabaya Rajapaksa, the South Asian island’s economy is in crisis, with usable foreign reserves down to $50m, Finance Minister Ali Sabry said last week.

Shortages of imported food, fuel and medicines have brought thousands onto the streets in over a month of mostly peaceful protests. Rajapaksa declared a second state emergency in five weeks on Friday.

The multilateral AIIB, founded in 2014 to promote infrastructure investing throughout Asia, draws most of its funding from China.

China is Sri Lanka’s largest bilateral lender, with an outstanding balance of $6.5 billion mostly lent over the past decade for large infrastructure projects, including highways, a port, an airport and a coal power plant.