China is considering offering a $1.5 billion credit facility to Sri Lanka and a decision is expected soon, a top Chinese official said on Monday, as part of efforts to help the island nation amid its worst economic crisis in decades.
Chinese ambassador to Sri Lanka Qi Zhenhong told reporters the two sides were also discussing a separate loan of up to $1 billion which the Sri Lankan government had requested.
He added that the South Asian nation was offered a loan of $500 million from the China Development Bank on March 18. Sri Lanka has to repay about $4 billion worth of debt this year, including a $1 billion international sovereign bond maturing in July. But its reserves dipped to $2.31 billion as of end February, down around 70% from two years ago.
The country is also struggling to make payments for imports of essentials such as fuel and medicines and enforcing nationwide power cuts due to a lack of fuel for power generation.