Long term $24 billion credit line to SL under OBOR initiative

Sri Lanka has been offered a long-term US$ 24 billion credit line from China under the ‘One Belt One Road’ (OBOR) initiative, official sources revealed.

This was a major outcome of Sri Lanka‘s participation in this forum in Beijing recently a senior official said adding that the Sri Lankan delegation headed by Prime Minister Ranil Wickremesinghe has had successful negotiations with Chinese authorities in gaining their support for local development projects.

The negotiations are at the preliminary stage on the nature of the Chinese line of credit whether through government to government or from the Chinasponsored Asia Infrastructure Investment Bank (AIIB), he disclosed.

Sri Lanka has borrowed billions of dollars from China to build domestic infrastructure. Sri Lanka’s estimated total debt is $64.9 billion, of which $8 billion is owed to China.

The China Communications Constructions Company (CCCC) is now constructing the $1.4 billion Colombo International Financial Centre, a new city along Colombo’s coastline that will become the city’s central business district by 2030 creating 80,000 jobs for Sri Lankans, under the OBOR initiative.

The ongoing development within Sri Lanka’s commercial city Colombo, which will be built on 269 hectares of reclaimed land, would accommodate 200,000 residents and consists of apartments, hotels, offices, shopping malls, exhibition centres, an official said.

China’s OBOR plan comprises a belt of overland corridors and sea routes connecting Asia, Africa and Europe through building infrastructure and boosting financial and trade ties for over 60 countries that lie along the routes.

Linked closely with the OBOR initiative, China has invested in developing Sri Lanka’s infrastructure and has emerged as one of Sri Lanka’s top five investors.

Using the OBOR initiative could further improve trade and investment linkages with China and other OBOR partner countries including East Asia and Europe, he added.

The Sri Lankan government has accorded priority to attracting more foreign investment and real estate investment will play a key role in achieving this objective.

The country is targeting foreign investment to the tune of US$3 billion in 2017, a BOI official said. (BS)