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US tells China to help Sri Lanka restructure debt

11 Sep, 2022

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By Easwaran Rutnam

The United States (US) today called on China to help Sri Lanka restructure its massive debt.

Visiting USAID Administrator Samantha Power told reporters in Colombo that it is imperative that all of Sri Lanka’s creditors, most notably China, cooperate in the process openly.

“When debt becomes unsustainable as it so clearly has in Sri Lanka, the stakes of that corporation can mean the difference between life or death, prosperity or poverty,” she said.

Power said that as a member of the Paris Club, the US Government will support Sri Lanka restructure its debt.

She said that the Biden administration is keen to help Sri Lanka get back on a more stable economic path.

The US official also said that there needs to be a change in habit that led to the rise of such debt in Sri Lanka.

Sri Lanka had this year defaulted on its debt for the first time in its history as the country struggles with its worst financial crisis in more than 70 years.

The country is now seeking to restructure debts of more than $50bn it owes to foreign creditors, to make it more manageable to repay. (Colombo Gazette)

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