‘China’s stand may deprive Sri Lanka of USD 2.9 bn from IMF in early 2023’

Executive Director of the Centre of Policy Alternatives (CPA) Dr. Paikiasothy Saravanamuttu told journalists and Civil Society Activists at a workshop held in Kandy that China’s unwillingness to accept the proposed debt restructuring might deprive Sri Lanka of the US$ 2.9 billion credit facility, from the IMF.

The staff-level agreement is to be implemented only after the countries that Sri Lanka are indebted to, namely Japan, China, India and the European Union, agree on how the debt is to be restructured.

Dr Saravanamuttu said the IMF expected every creditor to be treated equally which China has refused to accept. China was not happy that Sri Lanka had approached the IMF and have even offered to provide more loans to Sri Lanka, he said.

The CPA Executive Director said that if the Chinese agreed to restructure debt, then the IMF would release US$ 2.9billion by January or February 2023 but if the Chinese did not agree, Sri Lanka would have to wait until the IMF board meets again in March 2023. He said that Sri Lanka would need 850 million US$ to pay for essentials during this period.

Dr. Saravanamuttu said that citizens of this country should not blame the politicians alone for the mess that the country was in, as it is the people who put them there, gave them the power and allowed them to abuse it. He reiterated that the people had a great responsibility to see that the situation changes for the better.

Speaking about the Aragalaya, Dr. Saravanamuttu said that various groups had got together to demand that the Rajapaksas go home and return the money that they stole from the country. He pointed out that even though they had got rid of the Rajapaksas they did not have any idea how to recover the country’s plundered wealth or what type of governance that the country ought to have.

He said that even though mass protests had taken place all over the world, the political elite or the military had returned to power.