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Loans are not causing problems for Sri Lanka, claims China

The Chinese Embassy in the UK responded to a Financial Times editorial by hitting back at suggestions that loans to Sri Lanka were leaving Colombo in a “debt trap”.

“China and Sri Lanka have long been friendly neighbours that always support each other in their major and core interests,” claimed Zeng Rong spokesperson at the Chinese Embassy in the UK.

“The co-operation between the two countries is win-win and mutually beneficial. Such co-operation has delivered tangible benefit to the people of Sri Lanka.”

He went on to state that

“China is not competing with any country to seek so-called regional dominance. China-Sri Lanka co-operation is equal and mutually beneficial. It is not targeting any third party or setting a “debt trap”.”

The spokesperson stated that “China’s loans to Sri Lanka accounted for only about 10 per cent in Sri-Lanka’s foreign debts, while Japan accounts for 12 per cent, and the Asian Development Bank 14 per cent”.

“It is not tenable to claim that China’s loans are causing problems for Sri Lanka,” he concluded.

The statement comes as Sri Lanka signed two deals with Chinese firms worth over $50 million for development of the port city project on Thursday.