President appreciates Japan’s role in restructuring Sri Lanka’s external debt

(LANKAPUVATH | COLOMBO) – President Ranil Wickremesinghe has appreciated Japan’s leadership in international efforts to restructure Sri Lanka’s external debt.

In an interview with NHK, Wickremesinghe said everyone is comfortable with Japan serving as co-chair of a new international framework launched in April aimed at resolving Sri Lanka’s debt crisis.

“Japan is doing a lot….We are working closely with Japan in regard to debt restructuring,” he said.

Sri Lanka fell into default in April last year after fiscal policy decisions triggered a rapid depreciation of its currency and high inflation. Wickremesinghe assumed power in July last year amid political upheaval.

Japan regards Sri Lanka as an important partner in its effort to realize a free and open Indo-Pacific.

China also considers Sri Lanka as a partner in its Belt and Road initiative. It has been giving loans to the South Asian country.

In 2017, the management of a port in the south of the country was handed over to a Chinese firm on a 99-year lease after debt was not repaid. The incident is widely viewed as an example of “debt trap diplomacy.”

Wickremesinghe said China unfortunately lacks agencies like the Japan International Cooperation Agency to handle debt issues.

He emphasized that the Sri Lankan government controls security of the port operated by the Chinese company.

He noted that there have been port calls there by Japan’s Maritime Self-Defense Force vessels.


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