COLOMBO: China has provided USD 500 million loan to Sri Lanka from its development bank to help the country's economy.
Sri Lankan Ministry of Finance said that the USD 500 million loan would be released early next week to bolster the official reserves of the country. "The facility has been made available on a request made by the government of Sri Lanka to the Chinese government and the China Development Bank to support the development efforts," a statement said.
China's Central Bank this week reduced policy interest rates in view of the anticipated coronavirus impact. The Central Bank has felt the urgent need to support economic activity with the rapid global spread of the COVID-19 pandemic and its possible further spread in Sri Lanka, a statement said.
China is already one of the biggest investors in various infrastructure projects in Sri Lanka. But there has been criticism, both locally and internationally, and growing concerns that China has lured Sri Lanka into a debt trap.