Secretary to the Treasury Mahinda Siriwardana has said that the government hopes that the debt treatment chapter will soon be closed, and it would be possible to resume fresh financing for high quality, priority projects.

Siriwardana said so at the ‘2024 China Aid Training Alumni Reception’ at the Kingsbury Hotel, Colombo on Wednesday (30).

“We all know how complex and technically challenging this debt treatment process has been both in terms of ensuring compatibility with the IMF’s Debt Sustainability Analysis (DSA) as well as ensuring Comparability of Treatment with other creditors. This was possible with Chinese lenders, given the mutual trust and good faith demonstrated by both sides.”

Among those present were Chinese Ambassador Qi Zhenhong and Economic and Commercial Counsellor Tang Yandi.

Siriwardana appreciated what he called unwavering support in facilitating the successful participation of Sri Lankan public sector officials in various training programs in China over the past years.

“We have noted that, since its initiation, China has provided more than 8,000 training opportunities in various fields such as health, education, industry, and construction for public sector officials in Sri Lanka. It is impressive that Sri Lanka now receives nearly 1,000 training programmes each year from the Chinese government.”

Further, we cannot forget that China’s support for Sri Lanka has been instrumental in the country’s development, particularly in the realm of infrastructure and economic assistance. Over the years, China has invested billions of dollars in various projects, including ports. These investments aim to enhance Sri Lanka’s logistical capabilities and boost its position as a regional trade hub.

Furthermore, China has extended financial aid and loans to help Sri Lanka address its economic challenges, especially during times of crisis. Overall, China’s ongoing support plays a vital role in Sri Lanka’s aspirations for economic growth and modernization.

China has also played a pivotal role in supporting Sri Lanka’s debt treatment efforts in response to the unprecedented, deep and most complex economic crisis experienced since mid-2021. Exactly a year ago, in October 2023, China was the first among the official sector creditors to announce an Agreement in Principle (AIP) on the key financial terms for the treatment of debts owed by Sri Lanka to Exim Bank of China.

Subsequently, following cordial and constructive discussions, the two sides reached a final agreement on debt treatment terms in June 2024, on the same day when a similar MoU was signed with the Official Creditor Committee (OCC) comprising 17 official sector lenders to Sri Lanka and co-chaired by France, India and Japan. Subsequently, following the agreement coming into force, Exim Bank of China became the first external lender to conclude the debt treatment process. Excellent progress has also been made on the debt treatment relating to China Development Bank (CDB). We are now in the final stages of finalizing Comparability of Treatment (CoT) matters for CDB relating to the OCC.

Ambassador Zhenhong told the gathering that as a Chinese saying goes, “Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime.” China’s foreign aid training is a concrete action to implement global development initiative raised by President Xi Jinping and an important measure to promote the building of a community with a shared future for mankind. China’s foreign aid training adheres to the concept of sharing, consultation and co-construction, builds a platform for countries to exchange experience in governance, and fully shares the successful experience of Chinese modernization. Since China launched foreign aid training programs in 1950, it has trained more than 510,000 people for developing countries.

The Chinese government attaches great importance to all-round educational cooperation with Sri Lanka. Over the years, it has used foreign aid funds to hold various training programs in China, inviting nearly 13,000 Sri Lankan friends of various circles to participate in seminars in China. By the end of October this year, more than 1,000 Sri Lankan participants went to China for training, and the training topics covered 17 major areas including public management, scientific research, information technology, economy and trade, education, health, agriculture, forestry, animal husbandry and fishery, resources and environment, and disaster management. Through mutual learning and exchanges, we have grown together and deepened the traditional friendship between our two countries.”