Sri Lanka foreign lenders led by China, export credits up

28 Nov, 2013 07:13:36

Nov 28, 2013 (LBO) - Sri Lanka has 1.9 billion US dollars of new bilateral and multilateral commitments up to September 2013 led by China with export credit from other countries also showing increases, a finance ministry report showed.

China has committed 517.9 million US dollars up to September, Japan 421.5 million US dollars, Asian Development Bank 371.2 million US dollars, the World Bank 196.4 million US dollars, the United Kingdom 103.7 million US dollars and USA 64.9 million US dollars.

While Japan, the ADB and World Bank gives long term loans at low interest China gives export credits at semi-commercial terms.

Sri Lanka has been using large volumes of export credits and supplier finance for infrastructure from the Exim Bank of China, but other countries are now also giving larger volumes of export credits.

Western nations have renewed their interest in promoting export credits to boost their domestic economies in recent years.

This year the Exim Bank of the US had loaned 64.9 million US dollars for a water supply project.

Export credits were also signed up from Spain (29.4 million Euros for water supply), Netherlands 57.7 million, Hungary 22.5 million Euro, UK 107.1 million for a milk factory and bridges), Belgium 6 million Euros and Austria 3.1 million US dollars.

The Exim Bank of China has given 283 million US dollars for railway track, 155.4 million for the Hambantota Port and 79.6 million for water supply.

Sri Lanka has notched up 8.0 billion US dollars in loans which were awaiting disbursement.

Unlike commercial foreign borrowings which are mostly used up in current spending, project loans are mainly for investments which can take around 4 years to complete.

Sri Lanka had 1.9 billion US dollars of commitments from China, 1.5 billion from Japan, 1.2 billion from ADB, 730 million from the World Bank, 680.7 million from India, 434 million from Iran and 235.4 million from Russia.